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The huge multi-billion-pound aviation deal that will boost UK economy

A deal between Rolls-Royce, aircraft manufacturer Airbus and airline Air India announced by the Government is said to be worth billions of pounds to the UK economy. Derby-based Rolls-Royce will be supplying engines to Airbus to power dozens of new A350 aircraft ordered by Air India.

Among the 250 aircraft ordered by Air India are reported to be some 40 Airbus A350 wide-bodied airliners. These are powered exclusively by the Trent XWB engine which is designed, manufactured and tested at Rolls-Royce's base in Sinfin. The Trent XWB is considered to be the world's most efficient large aero-engine.

Prime Minister Rishi Sunak praised what he described as a landmark deal and said that it would provide a multi-billion-pound boost to the UK economy.

Mr Sunak said: “This landmark deal between Air India, Airbus and Rolls-Royce demonstrates that the sky’s the limit for the UK’s thriving aerospace sector. It will create better-paid jobs and new opportunities in manufacturing hubs from Derby to Wales, so we can grow the economy and support our agenda to level up – helping to deliver on my five priorities for the country.

“The UK is already a top investment destination, and by building trade ties with growing economic powers like India we will ensure UK businesses remain at the forefront of global growth and innovation.”

As well as Rolls-Royce's engine expertise, much of the manufacturing of the new A350 and A320neo aircraft is expected to take place in the UK. The wings will be designed in Filton, and assembled in Broughton – which is expected to bring an additional 450 manufacturing jobs and more than £100m of investment to Wales.

In 2021, the UK’s aerospace sector added £10.6bn in value to the UK economy, exported c.70% of its domestic output and directly employed 111,000 high-skilled people, 89% of which are outside London and the Southeast. It is also a leading sector for high-value apprenticeships, with 5,500 currently employed in the sector.

India is a major economic power, projected to be the world’s third-largest economy with a quarter of a billion middle-class consumers by 2050. The government says they are currently negotiating a free trade agreement that would boost our £29.6 billion trading relationship.

Business and Trade Secretary Kemi Badenoch welcomed the deal for Airbus and Rolls-Royce to provide new aircraft for Air India.

She said: “This is a significant win for the UK's world-leading aerospace sector and one which will help to secure thousands of highly skilled jobs across the country and drive economic growth. It’s a shot in the arm for UK exports as we aim to sell £1 trillion of goods and services a year to the world by the end of the decade.

“We’re currently negotiating a trade deal with India which could boost trade by up to £28 billion a year by 2035. Export wins like this are another big step to our nations forming a closer trading relationship."


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