NEW DELHI, Jun 2: Commerce and Industry Minister Piyush Goyal on Tuesday held talks with UK Secretary of State for Business and Trade Peter Kyle on ways to further strengthen economic ties.
“Had great conversations on charting the next phase of India-UK economic engagement, advancing shared business priorities, and further strengthening our robust and forward-looking partnership,” Goyal said in a social media post.
The meeting was important as both sides had inked the Comprehensive Economic and Trade Agreement (CETA) on July 24, 2026.
Britain’s steel safeguard measure and carbon border adjustment mechanism (CBAM) have become a sticking point in the implementation of the trade pact.
Sources have said that India may rebalance some duty concessions on certain products like Scotch Whiskey under the agreement with the UK if these issues are not addressed.
From July 1, 2026, the UK will limit tariff-free steel imports, reducing overall quota volumes by 60 per cent compared to the steel safeguard measure. Any imports above these levels will then face a 50 per cent tariff.
The measure will apply to imports of steel products that can also be made in the UK.
Earlier, Britain had safeguard measures that also imposed import quotas. The new measures reduce that quota.
The UK government in December 2023 also decided to implement its Carbon Border Adjustment Mechanism (CBAM) starting in 2027.
According to economic think tank GTRI, India’s exports worth USD 775 million to the UK may be impacted due to Britain’s decision to introduce a carbon tax on products like iron and steel, aluminium, fertiliser and cement, from 2027.
The UK, after the European Union (EU), will be the second economy to implement CBAM. It calls the move the import carbon pricing mechanism, and it will initially focus on sectors like iron, steel, aluminium, fertiliser, hydrogen, ceramics, glass, and cement.
This tax could range from 14-24 per cent of the import value on full phase-out of free allowances under the ETS (Emission Trading System).
India’s exports of iron and steel and their products to the UK stood at USD 893.4 million in 2025-26, accounting for a significant share of USD 13.4 billion in total merchandise exports to the UK.
Sources also said that India could consider re-balancing the UK’s steel issue with British scotch concessions, offered by India in the CETA.
As per the pact, India has announced reducing the duty on UK whisky and gin from 150 per cent to 75 per cent and further to 40 per cent in the 10th year of the deal.
In India, Scotch whisky brands, such as Johnnie Walker, Chivas Regal, and The Glenlivet, are the most popular. Among these, Johnnie Walker is one of the best-selling Scotches here. (PTI)
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