India-UK Trade Deal Ties Car Duty Cuts to Price, Engine Size
India’s Free Trade Agreement (FTA) with the United Kingdom, signed in May 2025, outlines a gradual reduction in car import duties over the next 10 to 15 years. These reductions will be conditional—based on engine capacity and vehicle pricing—to strike a balance between promoting trade and protecting domestic automakers.
The agreement is expected to benefit companies like Tata Motors and its subsidiary Jaguar Land Rover by making premium British vehicles more accessible in the Indian market. However, to safeguard local manufacturers, the deal limits the entry of lower-cost imports that could disrupt the competitive landscape.
Designed to both stimulate trade and preserve industry interests, the FTA reflects India’s cautious but strategic approach to opening its automotive market. Experts note that while the agreement supports sectoral growth, significant price drops on luxury models are unlikely. Details on the phased rollout of tariffs and import quotas are still under discussion.