The Directorate General of Foreign Trade (DGFT) has operationalised the automotive import provisions of the India-United Kingdom Comprehensive Economic and Trade Agreement (CETA), paving the way for concessional-duty imports of up to 20,000 UK-built internal combustion engine passenger cars in the first year under the tariff rate quota (TRQ) mechanism. The notification also lays down the procedures governing quota allocation, eligibility, customs documentation and utilisation for eligible vehicle imports from the United Kingdom.
The first-year quota covers 20,000 internal combustion engine passenger cars, including 10,000 vehicles above 3,000 cc petrol or 2,500 cc diesel, 5,000 vehicles between 1,500 cc and 3,000 cc petrol (or up to 2,500 cc diesel), and 5,000 vehicles up to 1,500 cc. Separate tariff rate quota schedules have also been notified for ICE goods vehicles, while a dedicated TRQ regime for electric, hybrid and hydrogen-powered passenger cars will come into effect from the sixth year of the agreement. The notification also prescribes phased annual quota schedules and corresponding concessional customs duty rates over the duration of the pact.
The framework is expected to provide a preferential import route for eligible UK-built premium and luxury vehicles while retaining quantitative limits through annual quotas rather than permitting unrestricted concessional-duty imports. Manufacturers such as Jaguar Land Rover, MINI, Bentley, Rolls-Royce, Aston Martin, McLaren and Lotus could be among those eligible to benefit, subject to meeting the origin and eligibility conditions prescribed under the notification.
The public notice establishes the operational framework for administering tariff rate quotas covering completely built-up (CBU) passenger cars and goods vehicles imported from the United Kingdom. It specifies eligibility criteria, documentation requirements, quota allocation methodology, customs procedures and utilisation conditions that importers must comply with to avail themselves of the concessional tariff benefits under the agreement.
Only original equipment manufacturers (OEMs), or dealers and channel partners authorised by UK vehicle manufacturers, will be eligible to apply for TRQ allocations. Applicants must furnish a pre-purchase agreement issued by the OEM specifying the quantity of vehicles proposed to be imported, while every consignment must be supported by a valid UK Certificate of Origin. The eligibility conditions effectively prevent unauthorised traders from independently accessing the concessional-duty quota. Importers have also been asked to endeavour to pass on the benefit of the concessional customs duty to the final buyer or consumer.
Where the total quantity sought by eligible applicants remains within the annual quota, applicants will receive the quantity requested. However, if applications exceed the notified limit, allocations will be made on a pro-rata basis in proportion to the quantities specified in the respective pre-purchase agreements. DGFT will electronically issue TRQ certificates and monitor cumulative utilisation, with authorisations ceasing once the annual quota has been exhausted.
The notification also introduces a mechanism aimed at improving utilisation of the quota. Importers that fail to utilise a significant portion of their allotted quota during a TRQ year could see such under-utilisation taken into account while determining allocations for the following year. The DGFT has also retained the flexibility to review the allocation methodology after two years based on utilisation trends, signalling that the framework may be refined to improve the effective utilisation of the concessional import quotas.
TRQ authorisations will remain valid for 12 months from the date of issue or until the end of the relevant calendar year, whichever is earlier. The notification, which takes immediate effect, completes the procedural framework required to operationalise the automotive market access commitments under the India-UK CETA, enabling eligible UK-built vehicles to be imported into India under concessional tariff quotas, subject to the prescribed conditions.