British High Commissioner James Bevan, Federation of Indian Chambers of Commerce and Industry (FICCI) Secretary General Rajiv Kumar and UK-India Business Council (UKIBC) chief executive Richard Heald signed the agreement.
Visiting British Chancellor of the Exchequer, George Osborne, welcomed the initiative. "Indian companies demand the very best. That is what many highly innovative British enterprises offer. But even in our highly networked world, opportunities to match the right British technology to the right Indian partner can be missed," he said.
"This new initiative aims to correct that and, by doing so, increase the chance that a brilliant idea can be brought to market, potentially for the benefit of millions, if not billions of people."
The initiative aims to support Indian companies to access valuable technology, support British companies to develop their technology and build their capacity to export into the Indian market with support from Indian companies.
It also aims to support the development of globally focused trade partnerships between Indian and UK companies.
The first two-three months of the initiative will develop the evidence-base for the approach, design potential models for a pilot phase and explore potential funding options, FICCI said in a statement.
If the research phase shows the programme to be viable, the pilot phase will then run until reviewed in a year's time, it added.
In 2010-11, India was the third largest investor in Britain (after the US and Japan). Britain attracts more Indian investment than the rest of the European Union combined. More than 700 of the 1,200 Indian companies based in the EU have chosen to set up base in Britain.
The initiative will be jointly run by UK Trade and Investment (UKTI), FICCI, and UKIBC.