The India-UK Comprehensive Economic and Trade Agreement (CETA) and the Dual Contribution Convention (DCC) will come into force on July 15, 2026, with Commerce and Industry Minister Piyush Goyal calling the agreement India’s “most comprehensive” trade agreement to date and expressing confidence that it will become a “template” for future free trade agreements.Goyal, who is on a three-day visit to Britain to review preparations for the implementation, received the India Global Forum’s UK-India Award for “exceptional leadership in improving UK-India relations” at a ceremony in London. He was also joined on stage by his UK counterpart, Secretary of State for Business and Trade Peter Kyle.“I have absolutely no doubt in my mind that this will be successful, and that CETA will become a template, and a role model, for many other free trade agreements in the future,” Goyal said.He said, “It is not just about tariffs and rules of origin, it is not just about trade in goods and services, it is about cooperation in technology, education, culture, arts. It is focused on bringing the best of both the countries to each other.”British High Commissioner to India Lindy Cameron described the agreement as a cornerstone of the “Vision 2035” strategic partnership, and said it would lead to a more “trusting” and comprehensive bilateral relationship.Cameron said, “This is an important part of our Vision 2035 strategic partnership between the UK and India. To get the best economic growth for both our countries and it is an amazing deal. I think it will bring about five billion pounds of benefits in terms of GDP to both economies in the long run.”
Major provisions of the agreement
CETA provides zero-duty access to almost 99 per cent of India’s exports to the UK, covering almost the entire trade basket. Tariffs of up to 70 percent on processed food products, up to 21.5 percent on marine products, up to 18 percent on engineering goods and auto components and up to 12 percent on textiles and clothing will be eliminated.The agreement is expected to provide additional tariff benefits of 7-10 per cent to Indian exporters, bringing India at par with many other countries that already enjoy zero-duty access to the UK market. This opens up a market worth over US$500 billion for Indian businesses.The UK has provided one of its most comprehensive service commitments ever, covering all major service 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 allow phased import of 3.78 lakh conventional engined passenger vehicles from the UK over a period of 15 years under the quota system. In the first year, 20,000 passenger vehicles across various engine categories will be allowed at reduced duty rates, with the annual quota increasing to 37,000 units by the fifth year.Import duty in select categories will be reduced from approximately 110 per cent to 10 per cent during the implementation period. The agreement also provides limited access for electric, hybrid and hydrogen-powered vehicles from the sixth year onwards, subject to price bands and quota limits. India has kept vehicles priced below GBP 40,000 out of the concessional framework, protecting the domestic mass-market EV segment.
Whiskey and Spirits Fee
The agreement will significantly reduce import duties on UK whiskey and gin, reducing tariffs from 150 per cent to 75 per cent initially and to 40 per cent by the tenth year of the agreement. About 79 per cent of the Scotch imported into India is used by domestic manufacturers for blending and bottling operations.The Confederation of Indian Alcoholic Beverage Companies said the gradual cut would give domestic manufacturers time to adapt, but called for a review of state-level excise and taxation policies.
Steel Sector Safety Measures
The final agreement addresses India’s concerns regarding UK steel safeguards. About 85 per cent of India’s steel exports are expected to remain outside the scope of restrictive measures, while concessions have been secured on 188 tariff lines. Officials said India will continue its WTO-level participation on remaining issues.
double contribution convention
The DCC, which will come into effect on July 15, exempts Indian workers and employers from paying double social security contributions in the UK while on temporary assignment. The exemption period has been increased from 3 years to 5 years.According to the UK government, this agreement allows “detached workers” temporarily working abroad to remain covered by their home country’s social security system rather than contributing to the host country’s system. The agreement does not create new rights to state pensions or other social security benefits.Over 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 the sector’s export revenues.
Services Trade and Investment Relations
The agreement is expected to significantly boost exports in service sectors including information technology, financial services, education and professional consultancy. India’s services exports to the UK are set to reach around US$21.6 billion in 2024, while services imports stand at US$13.7 billion.The DCC is expected to reduce employment costs for Indian companies with UK operations, improve the competitiveness of Indian services exporters and facilitate cross-border workforce mobility. It is estimated that 90-95 per cent of Indian professionals working in the UK through Indian employers are expected to benefit from this arrangement.
Digital trade and regulatory coordination
CETA includes a chapter on digital trade that requires both parties to give legal recognition to electronic contracts, authentication and signatures. The agreement also includes provisions for protection against forced transfer of source code, although it does not guarantee the free flow of data across borders.Discussions over the UK’s carbon border adjustment mechanism are ongoing as the regulatory framework is yet to be finalised.
vision 2035
The agreement is part of the broader India-UK Vision 2035, a transformational roadmap redefining bilateral cooperation in trade, research, innovation, science and technology and knowledge. This approach aims to deepen economic ties through improved trade, investment, financial cooperation and innovation-driven partnerships.Both countries are aiming to double bilateral trade, which currently stands at around US$60-70 billion, to US$120 billion by 2030.