Tata was presented the GBE by British High Commissioner to India Sir James Bevan on behalf of Queen Elizabeth II.
"Mr Tata has been awarded an honorary GBE, one of the highest civilian honours conferred by the UK, in recognition of his services to UK-India relations, inward investment to the UK and philanthropy," the British High Commission said in a statement.
Tata is the only Indian national to be awarded the GBE since India became a republic in 1950, it added.
Commenting on the honour, Bevan said: "Ratan Tata's leadership, vision and integrity will remain the gold standard for generations of aspirational British and Indian business people."
Tata's contribution to the deep ties that exist between the UK and India has been invaluable, he added.
Queen Elizabeth II had conferred on Tata the honorary award of Knight Commander of the Order of British Empire (KBE) in 2009.
Tata is a member of the UK-India CEO Forum and the British Prime Minister's Business Advisory Group. As Chairman of Tata Sons, he oversaw the Tata Group, one of the leading foreign investors and employers in the UK.
Under his leadership the UK benefited from significant inward investment from Tata companies. Tata are now the largest manufacturing employer in the UK.