The ongoing free trade agreement (FTA) negotiations between the UK and India have seen the UK government express its desire for customs duty concessions on the export of electric vehicles (EVs) to India, according to an unnamed official. While no decision has been made on the matter thus far, there is growing demand for concessions on a specified number of vehicles per year to take advantage of India’s rapidly expanding EV market, which has attracted the attention of global players.
The UK, with plans to phase out internal combustion engine (ICE) vehicles by 2035, relies heavily on exports for its automotive industry. Experts suggest that diversifying their export destinations would be beneficial for the UK, as Europe currently makes up the majority of their exports.
The EV market in India is projected to reach one crore (10 million) units in annual sales by 2030, generating five crore (50 million) direct and indirect jobs, as stated in the Economic Survey 2022-23. In 2022, an estimated 10 lakh (1 million) EVs were sold in India. To promote domestic manufacturing of EVs, the Indian government has introduced fiscal incentives, including production-linked incentives (PLI) schemes for advanced chemistry cell (ACC) battery storage and the automobile sector.
With incentives in place, India has attracted interest from major international companies, such as Tesla, which is considering establishing a manufacturing plant in the country. As of now, Tata Motors holds a significant share of the passenger EV market in India, with their portfolio including the Nexon EV range, Tiago EV, and Tigor EV.
The FTA negotiations between India and the UK are ongoing, and both sides are discussing various complex issues. Thirteen rounds of talks have been completed, covering topics such as social security, automobiles, medical devices, movement of professionals, intellectual property rights, and duty concessions. The negotiations were initially scheduled to conclude by Diwali (October 24, 2022), but the deadline was missed due to political developments in the UK.
Q: What is the main request made by the UK in the FTA negotiations with India?
A: The UK has requested customs duty concessions on the exports of electric vehicles to India.
Q: How many EVs are expected to be sold annually in India by 2030?
A: The EV market in India is projected to reach 10 million units in annual sales by 2030.
Q: Which company is currently leading in passenger electric vehicles in India?
A: Tata Motors is the leading player in passenger electric vehicles in India.
Q: What are some of the topics being discussed in the FTA negotiations between India and the UK?
A: Some of the topics under negotiation include social security, automobiles, medical devices, movement of professionals, intellectual property rights, and duty concessions.