Published by Global Banking & Finance Review®
Posted on May 8, 2025
2 min readLast updated: January 24, 2026
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A UK-India trade deal is expected in three months, with phased tariff cuts on vehicles and no minimum import price for spirits.
By Shivangi Acharya
NEW DELHI (Reuters) -A bilateral trade deal between India and the United Kingdom could be signed after three months and will take over a year to implement, an Indian government official said on Thursday.
New Delhi and London concluded talks for a free trade deal on Tuesday, closing a long-coveted deal between the world's fifth and sixth largest economies.
India - the world's third largest car market - has offered separate import quotas to Britain for combustion engine vehicles and electric cars, the official said, and tariff cuts on the vehicles will be offered in a phased manner.
The quotas have been offered based on engine capacity and car prices, while "cheaper" cars have been kept out of the deal, the official added without elaborating.
They spoke on condition of anonymity as the details of the pact have not been made public.
The countries clinched the deal in the shadow of erratic tariffs imposed by U.S. President Trump, which have threatened to upend the stability of global trade. Trump has in the past, called New Delhi a "tariff abuser".
Separately, India and Britain agreed that New Delhi reserves the right to retaliate, if London introduces the Carbon Border Adjustment Mechanism, the official said.
India has sought exemption from Britain's CBAM, which aims to levy higher taxes on imports from countries with less strict climate policies.
New Delhi has also not set a minimum import price for tariff cuts on spirits as part of the trade deal, the official said.
India is the world's largest whisky market and the tariff cuts are aimed at making Britain's Scotch whisky industry more competitive.
(Reporting by Shivangi Acharya in New Delhi, writing by Hritam Mukherjee in Bengaluru; editing by Alexandra Hudson)
The article discusses the upcoming UK-India trade pact expected to be signed in three months.
The deal includes phased tariff cuts on vehicles and import quotas for UK cars.
India seeks exemption from the UK's Carbon Border Adjustment Mechanism.
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