The planned launch of the India-United Kingdom Comprehensive Economic and Trade Agreement (CETA) has faced an unforeseen hurdle with London introducing new protectionist steel safeguard measures. Both countries signed the landmark bilateral trade pact in July 2025 and were targeting a quick final rollout but British moves to drastically cut tariff-free steel import quotas by 60 percent have pushed negotiators back to the drawing board. Under the new British guidelines any steel shipments arriving after July 1 that are above these lower thresholds will be hit with a hefty 50 percent penalty duty.
Indian commerce officials said these aggressive domestic safeguards “were not built into the initial free trade negotiations.” This is a development which brings about serious complications. Iron and steel products constitute an important part of the multi-billion dollar export programme of New Delhi to the British market. The tough quotas threaten to end the duty-free benefits that Indian exporters were promised under the original terms of the trade pact.
Negotiators are working hard to rescue the trade deal despite the sudden diplomatic friction. Indian Commerce Secretary Rajesh Agrawal said the two administrations were working together “productively” to find a “unique and creative solution” to resolve successfully the surprise steel dispute. While the initial aim of executing the deal is being stalled, both governments have publicly committed to ending the impasse quickly. Solving this industrial standoff is crucial for unlocking the broader scope of the deal, which promises to slash tariffs on British scotch whisky and vehicles, eliminate duties on 99 percent of Indian goods and ultimately double bilateral trade to 56 billion dollars by 2030.
