An official representative of the Ministry of Commerce reported that India has received a limited number of Tariff Rate Quota (TRQ) applications from automotive companies in the UK seeking to supply vehicles at preferential rates under the Free Trade Agreement (FTA).
According to this official, out of the total quota applications of approximately 10,000 units submitted for 2026, only 642 cars are likely to be imported.
India granted the UK phased tariff concessions on automobiles under a limited annual quota according to the FTA, which came into force on July 15. In the first year, the TRQ limit is 20,000 units, with duties decreasing from 110 percent to 30 percent for large vehicles and from 66 percent to 50 percent for mid-range cars.
On July 20, the Directorate General of Foreign Trade (DGFT) requested TRQ applications from British automakers for supplies of 10,480 units in the current calendar year. The government also extended the deadline for TRQ applications by five days, setting the new deadline as August 9.
However, as the official representative clarified, only eight British automakers submitted applications, and one of them failed to provide all the necessary documentation and was asked for additional materials. Ultimately, they stated that seven companies applied for a quota of 642 units, and all of them were approved.
Only Original Equipment Manufacturers (OEMs) and dealers or channel partners duly authorized by OEMs can claim the TRQ. To receive preferential duty from Customs, importers must provide a valid certificate of origin issued by UK authorities, as well as a valid TRQ certificate issued by the DGFT.
Overall, the Comprehensive Economic and Trade Agreement between India and the UK (CETA) uses a phased approach through tariff quotas. Under this agreement, India will reduce import duties on automobiles from a high level of 110 percent to 10 percent, establishing quotas on both sides.
The government committed to reducing the tariff on Internal Combustion Engine (ICE) vehicles to 10 percent by the end of the fifth year. Meanwhile, electric, hybrid, and hydrogen vehicles will not receive any tariff benefits during the first five years.
Starting from the sixth year, limited benefits will only be introduced for more expensive models: models priced between £40,000 and £80,000 will be subject to a 50 percent duty within a quota of 400 units, and vehicles priced above £80,000 will be subject to a 40 percent duty within a quota of 4,000 units; both categories will reach the 10 percent rate by the tenth year. Cars priced below £40,000 will remain permanently excluded from benefits, thus preserving protection for India's mass-market EV manufacturers.
Importing cars into India from the UK beyond the established quota will continue to be subject to the applicable duty.