The Indian government has released the list of quotas and tariffs for automobile imports from the United Kingdom under the trade deal between the two countries. The India-U.K. Comprehensive Economic and Trade Agreement (CETA) will come into force on July 15.

As per the Directorate General of Foreign Trade’s notification, a total of 20,000 completely built units (CBUs) of petrol and diesel passenger vehicles will be allowed for import from the U.K. at concessional rates of 30-50%, depending on the size of the car, down from the normal import duty of between 66-110%. 

This quota will increase to 37,000 cars by year 5 of the deal, which is also when the concessional tariff will settle at 10% and remain there. However, after this, the size of the quota will gradually decrease, settling at 15,000 passenger vehicles in year 15.

Similarly, the notification also lays out the quotas and tariffs for electric vehicles (EVs), hybrids, and hydrogen-based passenger vehicles. While the gradations for the conventional fuel passenger vehicles are made on the basis of engine size, the gradations for these alternate fuel vehicles are on the basis of cost. 

The concessions for these vehicles will kick in only from year 6 of the deal, providing domestic manufacturers a buffer before they will have to start competing with U.K. brands. 

Under the deal, no alternate fuel vehicle with a landed cost of less than 40,000 pounds (about ₹51.2 lakh) will receive any concessions. A total of 400 alternate fuel vehicles priced between 40,000-80,000 pounds (₹51.2-102.4 lakh) will be allowed in the sixth year, at a tariff of 50%, down from the normal 110%. 

This quota will gradually increase to 2,000 vehicles per year by year 15, and the tariff will fall to 10% by year 10 of the deal’s implementation. 

Ultra-luxury alternate-fuel passenger vehicles priced above 80,000 pounds will receive the highest quota — starting at 4,000 vehicles in year 6, which will increase to 20,000 vehicles by year 15. The tariff on these vehicles will start at 40% in year 6 and fall to 10% by year 10.

Commerce Minister Piyush Goyal will travel to the United Kingdom on June 25-27 to meet his U.K. counterpart and review the preparedness of both countries for the implementation of the India-U.K. Comprehensive Economic and Trade Agreement (CETA) and its companion Double Contribution Convention (DCC) on July 15.

During the visit, the Ministry of Commerce said in a statement on Wednesday (June 24, 2026), Mr. Goyal will hold a high-level bilateral meeting with Peter Kyle, the UK’s Secretary of State for Business and Trade.

“The engagement marks an important step towards the operationalisation of the agreements and the strengthening of the economic partnership between the two countries,” the Commerce Ministry statement said.

“The bilateral discussions will focus on aligning regulatory roadmaps, streamlining cross-border customs coordination and finalising administrative mechanisms to facilitate the smooth implementation of CETA and the DCC,” it added. 

The Ministers will also review preparedness for the implementation of the CETA’s tariff liberalisation commitments and the operational roadmap for the DCC. 

“The two sides will further discuss the operationalisation of mutual market access commitments across key services sectors and review measures aimed at strengthening bilateral trade and investment ties,” the statement said.

India’s digital trade compact with the United Kingdom breaks new ground. Chapter 12 of the India-U.K. Comprehensive Economic and Trade Agreement (CETA) sets out a bargain that trades some oversight tools for access, credibility and scale. The trade-off has sparked a policy debate. Supporters call it a strategic step into the global digital economy. Critics call it a retreat from digital sovereignty. Such agreements rarely produce winner-take-all outcomes. They usually end in negotiated compromises. On balance, the gains look real, but they signal a need for guard rails that keep pace with evolving risks.

The digital wins

The digital wins are clear. The agreement recognises electronic signatures and contracts and commits both sides to work towards mutual recognition. That trims paperwork for software-as-a-service firms and also lowers barriers for small and medium enterprises. Paperless trade and electronic invoicing make cross-border documentation and payments easier. And policy continuity on zero customs duties for electronic transmissions protects a software export pipeline that the Commerce Ministry estimates at $30 billion a year.

Cooperation on data innovation can help too. The text encourages pilot projects that use regulatory sandboxes where required. That gives payments and other data-driven firms a way to test and scale tools under supervision, which builds credibility abroad. Beyond the digital chapter, the broader India-U.K. deal is expected to improve day-to-day commerce. Industry expects that as the agreement is implemented, close to 99% of Indian merchandise exports could enter the U.K. duty-free, with textile tariffs falling sharply, including from 12% to zero on key lines, increasing growth prospects in textile export hubs such as Tiruppur (Tamil Nadu) and Ludhiana (Punjab). Analysts also point to more doors opening in British public procurement for Indian IT suppliers. Employers say social-security waivers for short assignments could cut payroll costs by roughly one-fifth. These moves promise a wider and more predictable trade corridor.

The digital costs

Nevertheless, the possible digital costs deserve attention. Critics have contended that India has stepped back from source-code checks as a default regulatory tool, as there is a ban on code-inspection under the agreement. Regulators can demand access on a case-by-case basis, tied to an investigation or a court process.

Government procurement is excluded from the scope of digital trade. Hence any access to source code in products procured by government is not restricted. While the agreement aims to enhance business trust, it does not sacrifice essential interests. A general security exception exists. It preserves national supervision of power grids, or payment systems and other critical infrastructure, even if privately owned. The restriction is only of good governance, ensuring that action is not taken in a manner which would constitute a disguised restriction on trade. Should additional reassurance be required, a practical step could be to accredit trusted labs for reviewing sensitive code, under tight safeguards.

On government data, the posture is voluntary. There is no legally binding commitment. India decides what to publish and in what form. When it does open a dataset, it should be machine-readable and easy to reuse. This is not a blank cheque for anyone to demand access. India could also seek clear audit trails for cross-border data intermediaries so that accountability follows the data.

There is no “automatic MFN (most favoured nation)” for cross-border data flows. Instead, the agreement creates a forward review mechanism. If one side later signs a trade pact with tougher data rules, the two sides consult on whether to extend equivalent terms. There is a promise to talk; not an autopilot extension.

A formal review is stipulated within five years. As multiple versions of ChatGPT in under three years show that AI is developing rapidly, future pacts should have a review every three years to align rules with risks.

Editorial | Promising compromise: on the India-United Kingdom Comprehensive Economic and Trade Agreement 

Aligning with modern trade norms marks a departure from past Indian practice, but this makes sense for a country that is seeking a larger role in the global digital economy. It reflects India’s shift from trade scepticism to strategic engagement.

Domestic foundations usually anchor external commitments. The Digital Personal Data Protection Act of 2023 still needs notification of final rules. For future trade texts to build on that framework, the rules need to institutionalise open consultations before deals are closed so that inputs are sought and concerns surface early and can be addressed in time.

Steps to take

Digital treaties decide what governments can regulate, what companies can expect, and what citizens can protect. Chapter 12 of the India-U.K. agreement is a milestone in terms of a first step. In future, India should integrate market-openness with regulatory oversight. It could accredit trusted labs to review sensitive code under strict safeguards and also mandate audit trails for cross-border data flows. It could also institutionalise broad-based pre-negotiation consultations and schedule regular three-year reviews of digital treaties. Together, these steps show that sovereignty and global engagement need not pull in opposite directions but, instead, can power the modern Indian economy.

Syed Akbaruddin is a former Indian Permanent Representative to the United Nations and, currently, Dean, Kautilya School of Public Policy, Hyderabad. Shivangi Pandey is Executive Assistant to the Dean, Kautilya School of Public Policy, Hyderabad