As per the agreement, import duties on automobiles will be lowered over 10-15 years, excluding “futuristic cars” and “low-cost” cars.
For ICE vehicles, the quota bands will be based on engine capacity, while for electric vehicles, the bands will be based on price. Certain types of cars will not be included in the agreement.“>
A senior government official has said that the India-United Kingdom Free Trade Agreement (FTA) will feature quota bands for automobiles based on engine capacity for internal combustion engine (ICE) vehicles and price for electric vehicles, The Hindu reported. The agreement also includes sharing electronic certificates of origin to ease Indian exports and a Double Contribution Convention (DCC) to save temporary workers in the UK and their employers approximately ₹4,000 crore annually. Import duties on automobiles will be lowered over 10-15 years, excluding “futuristic cars” and “low-cost” cars. This measure is expected to significantly streamline business operations for Indian exporters.
How would it be categorised?
For ICE vehicles, the quota bands will be based on engine capacity, while for electric vehicles, the bands will be based on price. Certain types of cars will not be included in the agreement.
The FTA is expected to provide India with a competitive advantage in specific agricultural sectors. This will also be excluding sensitive agricultural and industrial products, but giving India a competitive edge in grapes, mangoes, and marine products.
Certain sensitive agricultural products will be excluded from the agreement. Sensitive industrial products have also been excluded from the deal.The official added that sensitive industrial products such as precious metals, smartphones, and optical fibres too were excluded from the deal.
The agreement addresses medical devices, with a provision for duty reduction. On medical devices, the duty would only be reduced and not eliminated, and that too only from the sixth year of the deal.
The current system only provides benefits after 10 years of contributions.
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