India will impose phased tariffs and quotas on U.K. vehicle imports under the India-U.K. Comprehensive Economic and Trade Agreement (CETA), effective July 15, 2026. The Directorate General of Foreign Trade has outlined the terms, which include concessional rates for petrol, diesel, and alternate-fuel vehicles.
Quotas and Tariffs for Petrol and Diesel Vehicles
The deal allows 20,000 completely built petrol and diesel passenger vehicles to be imported annually at reduced tariffs of 30-50%, down from the standard 66-110%. This quota will rise to 37,000 by year five, with tariffs settling at 10%. After year five, the quota will gradually decrease, reaching 15,000 vehicles by year 15.
Concessions for Electric and Hybrid Vehicles
Alternate-fuel vehicles, including EVs and hybrids, will see concessions starting in year six. The tariffs and quotas for these vehicles are based on cost rather than engine size. No concessions will apply to vehicles with a landed cost below £40,000 (₹51.2 lakh).
For vehicles priced between £40,000-80,000 (₹51.2-102.4 lakh), the quota begins at 400 units in year six at a 50% tariff, increasing to 2,000 units by year 15. The tariff for these vehicles will drop to 10% by year 10.
Ultra-luxury alternate-fuel vehicles priced above £80,000 will have the highest quota, starting at 4,000 units in year six and rising to 20,000 by year 15. Their tariff will begin at 40% in year six, reducing to 10% by year 10.
