The India-UK Comprehensive Economic and Trade Agreement (CETA) and the Double Contribution Convention (DCC) will come into effect on July 15, 2026, with Commerce and Industry minister Piyush Goyal describing the agreement as India’s “most comprehensive” trade pact to date and expressing confidence it will become a “template” for future free trade agreements.Goyal, who is on a three-day visit to the UK to review preparedness for implementation, received the India Global Forum’s UK-India Award for “Exceptional Leadership in Elevating UK-India Ties” at a ceremony in London. He was joined on stage by his UK counterpart, Peter Kyle, Secretary of State for Business and Trade.“I have absolutely no doubt in my mind that this will be a success, and this CETA will become a template, and will be a role model for many other free trade agreements in the future,” Goyal said.“It’s not only about tariffs and rules of origin, it’s not only about trade in goods and services, it’s about collaborations in technology, in education, culture, the arts. It is focused on bringing the best of both countries to each other,” he added.British High Commissioner to India Lindy Cameron described the agreement as the cornerstone of the “Vision 2035” strategic partnership, adding that it will foster a more “confident” and expansive bilateral relationship.“This is a key part of our Vision 2035 strategic partnership between the UK and India. Getting the best economic growth for both of our countries and it’s an amazing deal. This will be, I think, almost five billion pounds worth of benefit in GDP terms to both economies in the long run,” Cameron said.
Key provisions of the agreement
The CETA provides zero-duty access on approximately 99 per cent of India’s exports to the UK, covering nearly all of the trade basket. Tariffs of up to 70 per cent on processed food products, up to 21.5 per cent on marine products, up to 18 per cent on engineering goods and auto components, and up to 12 per cent on textiles and clothing will be eliminated.The agreement is expected to provide an additional tariff advantage of 7-10 per cent to Indian exporters, bringing India at par with several other countries that already enjoy zero-duty access to the UK market. It opens up a market worth over USD 500 billion for Indian businesses.The UK has provided one of its most comprehensive services commitments ever, covering all major services sectors and 137 sub-sectors of export interest to India, including IT and IT-enabled services, financial services, professional services, healthcare and education.
Automotive sector commitments
India will permit phased imports of up to 3.78 lakh conventional-engine passenger vehicles from the UK over a 15-year period under a quota system. In the first year, 20,000 passenger vehicles across different engine categories will be allowed at reduced duty rates, with the annual quota rising to 37,000 units by the fifth year.Import duties in select categories will decline from about 110 per cent to 10 per cent over the implementation period. The agreement also provides limited access for electric, hybrid and hydrogen-powered vehicles from the sixth year onward, subject to price bands and quota ceilings. India has kept vehicles priced below GBP 40,000 outside the concessions framework, shielding the domestic mass-market EV segment.
Whisky and spirits tariffs
The agreement will significantly reduce import duties on UK whisky and gin, with tariffs set to fall from 150 per cent to 75 per cent initially and further to 40 per cent by the tenth year of the pact. Nearly 79 per cent of Scotch imported into India is used by domestic manufacturers for blending and bottling operations.The Confederation of Indian Alcoholic Beverage Companies said the gradual reduction would provide domestic manufacturers time to adapt, but called for a review of state-level excise and taxation policies.
Steel sector safeguards
India’s concerns regarding UK steel safeguard measures have been addressed in the final agreement. Around 85 per cent of India’s steel exports are expected to remain outside the scope of restrictive measures, while concessions have been secured across 188 tariff lines . Officials said India will continue WTO-level engagement on remaining issues.
Double Contribution Convention
The DCC, which will also enter into force on July 15, exempts Indian workers and employers from making dual social security contributions in the UK during temporary assignments. The period of exemption has been increased from 3 years to 5 years .According to the UK government, the agreement allows “detached workers” temporarily working abroad to remain covered by their home country’s social security system instead of contributing to the host country’s system. The agreement does not create new rights to state pensions or other social security benefits.More than 75,000 Indian professionals and over 900 companies are expected to benefit. The UK is India’s second-largest export market for IT services, accounting for an estimated 17 per cent of sector export revenues.
Services trade and investment linkages
The agreement is expected to significantly boost exports in services sectors including information technology, financial services, education and professional consulting. India’s services exports to the UK reached approximately USD 21.6 billion in 2024, compared to services imports of USD 13.7 billion.The DCC is expected to reduce employment costs for Indian companies with UK operations, improve the competitiveness of Indian service exporters, and facilitate cross-border workforce mobility. An estimated 90-95 per cent of Indian professionals working in the UK through Indian employers are expected to benefit from the arrangement.
Digital trade and regulatory coordination
The CETA includes a chapter on digital trade requiring both parties to accord legal recognition to electronic contracts, authentication and signatures. The agreement also includes provisions protecting against the forced transfer of source code, though it does not guarantee the free flow of data across borders.Discussions on the UK’s Carbon Border Adjustment Mechanism remain ongoing as the regulatory framework is yet to be finalised.
Vision 2035
The agreement is part of the broader India-UK Vision 2035, a transformative roadmap redefining bilateral cooperation across business, research, innovation, science and technology, and knowledge. The vision aims to deepen economic ties through enhanced trade, investment, financial cooperation, and innovation-driven partnerships.Both countries are aiming to double bilateral trade, currently estimated at around USD 60-70 billion, to USD 120 billion by 2030.
