India-UK Pact To Drive EV Exports, Lower Duties

India and the UK are set to sign a landmark free trade agreement this week, granting Indian electric vehicles (EVs) and hybrid vehicles duty-free access to the UK market under a quota system. 

The deal, expected to be formalised during Prime Minister Narendra Modi’s visit to London, follows three years of negotiations concluded in May, aiming to enhance bilateral trade.

Tariff Reductions for EVs

India will likely slash duties on British cars, including EVs, from 100 per cent to 10 per cent under a gradually liberalised quota, enabling competitive pricing for UK manufacturers. In return, Indian EV makers gain access to the UK, boosting exports in a growing sector. 

The agreement, effective in about a year pending approvals from Britain’s parliament and India’s cabinet, supports India’s push for clean mobility.

Other Commodities Benefit

The deal will also cover other goods briefly. Indian textiles, leather, and processed foods will enjoy zero-duty access to the UK, benefiting 99 per cent of India’s exports. 

British whisky tariffs will likely drop from 150 per cent to 75 per cent, falling to 40 per cent over a decade, alongside reduced duties on UK food and cosmetics, covering 90 per cent of tariff lines.

This trade deal would come at a strategic timing amid global trade tensions, including US tariff threats. The agreement is also poised to double bilateral trade to USD 120 billion by 2030, creating a win-win situation for both nations. 

Also read: MG4 To Be First Mainstream EV With Semi-Solid-State Battery