India UK FTA automobile industry impact — Tariffs to come down from over 100% to 10%!

The Indian Government has concluded negotiations with the Government of the United Kingdom on a free trade agreement that is to be signed soon. What makes this relevant for the automotive sector is a reduction in import tariffs from over 100% to 10% for a fixed quota. Read more about this news and the India UK FTA’s impact on the Indian automobile industry.

India UK trade deal

India and the United Kingdom have been long discussing a free trade agreement, with the talks resuming back in February 2025. Both governments have now come to agreement on the terms and are to soon sign the official agreement. This will facilitate easier and enhanced trade between two of the world’s largest economies.

Also Read: Skoda Kushaq pros and cons — Great handling but questionable DSG reliability

India UK FTA benefits — Auto industry

As part of the agreement, India will reduce tariffs levied on the import of CBU cars from the UK from over 100% to just 10%, paving the way for reduced high-end car prices in India. Cars and SUVs from brands like Range Rover, Rolls Royce, and Aston Martin will significantly benefit from this. Major carmakers like BMW and Skoda also import certain models from the UK. Moreover, exporting vehicles to the UK has also been made easier for companies like Mahindra, which plans to sell its electric SUVs there, and TVS, which is planning something around its Norton brand. Auto component companies are also to benefit from this deal.

Check This Out: Mahindra new SUV platform coming on August 15 — New Bolero incoming?

Auto exports and imports data

As per the Automotive Component Manufacturing Association of India (ACMA), India imported automotive components worth Rs 1,150 crore, and exported components worth of Rs 1,590 crore in 2024. During the same period, cars worth Rs 650 crore and motorcycles worth Rs 30 crore were imported from Britain. Speaking of exports, these numbers stood at Rs 50 crore for motorcycles and Rs 70 crore for tractors.

To stay updated with all happenings and developments in the automotive world and be a part of interesting auto discussions and more, join our official AUTOVERSE Whatsapp community (click here to join).