The India-UK free trade deal, signed in May last year and expected to take effect this year, has run into hurdles after Britain proposed stricter safeguards on steel imports to protect its domestic industry.
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“So now the ball is in their (UK) court,” an Indian trade official told reporters on Monday. “If they do not leverage their free trade agreement, we can always reconsider the concessions we offered.”
Britain’s Trade Secretary Peter Kyle is due in India for talks with Commerce Minister Piyush Goyal on Tuesday.
Under the trade pact, India agreed to cut tariffs on Scotch whisky from 150% to 75% initially and further to 40% over 10 years.
The deal envisages tariff reductions by both sides on a range of goods, from textiles to whisky and cars, while expanding market access for businesses in the world’s fifth- and sixth-largest economies.The two countries expect the agreement to boost bilateral trade by an additional 25.5 billion pounds ($34 billion) by 2040.
India has objected to Britain’s steel safeguard measures, arguing they could restrict market access for Indian exports. The dispute centres on tariff-free quotas and higher duties on some steel shipments, creating fresh uncertainty for Indian exporters even as both sides work to implement the trade pact, officials said.
India, along with Brazil, Turkey, Japan, South Korea, Switzerland and Australia, has raised concerns at the World Trade Organization over Britain’s new restrictions on tariff-free steel imports.
Britain has also proposed imposing carbon-related border measures from January 1, 2027, covering imports of products such as iron and steel, aluminium, cement and fertilisers as part of its efforts to reduce carbon emissions.