India to allow 3.78 lakh UK cars at lower duty

India will allow import of up to 3.78 lakh units of conventional-engine passenger cars, including mass-market models, from the UK at concessional import duty during the first 15 years of the implementation of the bilateral trade pact, which will come into force from July 15.  Under the comprehensive economic and trade agreement (CETA), import duties on automotive products will fall from about 110 per cent to 10 per cent, with quotas on both sides. According to the India-UK CETA document, released, India will get access to the UK’s electric, hybrid/hydrogen passenger cars segment with duty-free exports to that country from the sixth year in the price segment ranging from GBP 20,000 to GBP 80,000, with the total quota reaching a peak of 88,000 units from the 15th year and continuing in the subsequent years. This will benefit Indian manufacturers such as Tata Motors Passenger Vehicles, Mahindra & Mahindra, and Maruti Suzuki, among others. The two countries announced the implementation of CETA from July 15. For imports from the UK to India, the quota for conventional-engine passenger cars will peak in the fifth year across specified categories of vehicles at 37,000 units, with customs duties reduction reaching a final 10 per cent. The duties will not be reduced beyond this. In the first year, the quota for passenger cars of engine size more than 3,000 cc (petrol) and over 2,500 cc (diesel) is 10,000 units, with customs duty being reduced to 30 per cent from 110 per cent. For cars with engine size of 1,500 cc (petrol), 2500 cc (diesel) and 3,000 cc (petrol), the quota is 5,000 units, with duty being reduced to 50 per cent from 66 per cent. In the mass market segment of engine size of up to 1,500 cc, the allowed quota of import in the first year of the pact is 5,000 units, with customs duty being reduced to 50 per cent from 66 per cent, as per the document.