India’s Directorate General of Foreign Trade (DGFT) approved applications from seven companies to import 642 cars from Britain on 16 September 2026. The allocation was made under the tariff rate quota (TRQ) provisions of the India-UK Comprehensive Economic and Trade Agreement (CETA), which came into effect on 15 July 2026.
India-UK Comprehensive Economic and Trade Agreement
The India-UK Comprehensive Economic and Trade Agreement is a bilateral trade pact between India and the United Kingdom. Under this agreement, tariffs on automotive imports from the UK are set to fall from around 110% to 10% within the quota.
Tariff Rate Quota in Trade Policy
A tariff rate quota allows a fixed quantity of imports to enter at a lower customs duty, while imports beyond the quota attract higher duties. In this case, the quota applies to UK-origin cars imported into India under the CETA framework.
India has committed to allowing the import of 378,000 conventional-engine passenger cars from the UK at concessional customs duties over the first 15 years of the agreement.
Eligibility and Allocation Process
Only Original Equipment Manufacturers, dealers, and channel partners authorised by UK-origin vehicle makers were eligible to apply for the TRQ. The DGFT invited applications in July 2026 for a quota of about 5,000 vehicles for the year 2026.
Out of eight companies that applied, seven received approval and one received a deficiency certificate. This was the first allocation under the 2026 quota.
Important Facts for Exams
- The DGFT is the authority that administers import and export policy in India.
- TRQ stands for tariff rate quota and is used in customs duty administration.
- CETA is the abbreviation for the India-UK Comprehensive Economic and Trade Agreement.
- Original Equipment Manufacturers are firms that produce vehicles or components under the original brand specification.
Trade and Customs Context
Customs duty is a tax levied on goods imported into a country. Passenger cars are a major category in automotive trade negotiations under bilateral free trade and preferential trade agreements.
