India-UK Free Trade Agreement May Come into Effect from May; Import Duties on Cars and Whisky to be Reduced

New Delhi. The Free Trade Agreement (FTA) between India and the UK is likely to come into force starting next month. According to sources, the agreement is expected to take effect from the second week of May.

Both nations signed the Comprehensive Economic and Trade Agreement (CETA) on July 24, 2025. Under this agreement, 99 percent of India’s exports will gain duty-free access to the UK market, while India will reduce import duties on British products—such as cars and whisky—in a phased manner. India and the UK have set a target to double their bilateral trade from the current $56 billion by the year 2030.

Improved Access for Indian Products: According to the terms of the agreement, India has opened its market to various consumer products—such as chocolates, biscuits, and cosmetics—while Indian exporters will gain improved market access for textiles, footwear, gems and jewelry, sports goods, and toys.

Export Opportunities for Electric and Hybrid Vehicles:
Import duty on British Scotch whisky will be immediately reduced from 150 percent to 75 percent. This duty will be gradually brought down to 40 percent by the year 2035.
In the automobile sector, India will reduce import duties from the current 110 percent to 10 percent over a period of five years.
In return, Indian companies will gain access to the British market for exporting electric and hybrid vehicles on a quota basis.
India and the UK have also signed a Double Contribution Treaty agreement.
This ensures that temporary workers from both countries will not be required to pay social security contributions twice.