Ahead of UK trade deal roll out, India notifies lower customs duty for car imports

Car lovers may rejoice! With the implementation of the India-UK free trade pact from July 15, the government has cut the import duty on UK cars and released the procedure to apply for the lower tariffs.

The Directorate General of Foreign Trade in a notification has notified the procedure for importers to seek approval for quota-based duty concessions on imports of passenger cars and goods vehicles under the trade deal with UK.

This dispensation will be available for specified internal combustion engine passenger cars and goods vehicles as well as electric, hydrogen and hybrid passenger cars imported from the UK. The new rates will be applicable from July 15.

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Under the India-UK Comprehensive Economic and Trade Agreement (CETA), India has committed to reduce import duties on automobiles from the current 110% to 10% based on quotas over a 10-15-year period. It will permit import of 378,000 units of ICE engine passenger cars and 137,000 units of electric, hydrogen and hybrid cars during the first 15 years of the implementation of the trade pact between the two countries at the concessional tax rate. It will also allow 32,500 commercial goods vehicles in a 10-year period at concessional rates.

“At the time of clearance of the import consignment, the importer in India must produce a Certificate of Origin issued by concerned authorities in UK. 4. The application window for submission of TRQ applications, for each calendar year, will be intimated through a separate Public Notice from time to time,” said the notification by the DGFT, adding that the year in respect of these imports will be the period from January 1 to December 31.

“Importers under TRQ shall endeavour to pass on the benefit of the concessional customs duty available under the TRQ to the final buyer or consumer,” it further said.