India, UK Working To Settle Steel Issue Ahead Of Trade Pact Rollout: Commerce Secy

New Delhi, May 16 (KNN) India and the United Kingdom are working to resolve differences over Britain’s new steel safeguard measure, which has emerged as the key obstacle to bringing their landmark Comprehensive Economic and Trade Agreement (CETA) into force. 

The two countries signed the CETA on July 24, 2025, under which 99 per cent of Indian exports would enter the UK duty-free, while India would reduce tariffs on British goods including cars and whisky. 

However, the UK's decision to introduce a new steel safeguard measure — announced after negotiations were concluded — was not accounted for in the agreement, creating a complication that has held up its operationalisation.

Commerce Secretary Rajesh Agrawal on Friday told PTI, “We are very near to operationalising that. There are a few sticking points, as you are aware, the UK has come ahead with a steel measure recently, which was not factored in while negotiating the India-UK deal.” 

“We are working together to find a unique, creative solution around the steel measure also so that we can officialise the India-UK CETA at an early date," he added.

Effective July 1, 2026, the UK will reduce overall tariff-free steel import quotas by 60 per cent compared to existing levels. Imports exceeding the revised quota will attract a 50 per cent tariff, applying specifically to steel products that can also be manufactured domestically in Britain.

Effect on Indian Steel Exports

India's exports of iron, steel, and related products to the UK stood at USD 893.4 million in FY2025–26, representing a significant share of the total USD 13.4 billion in merchandise exports to the UK that year. The new quota reduction, if unaddressed, could materially affect Indian steel exporters once the agreement takes effect.

Implementation

The CETA has already been cleared by both houses of the UK Parliament and approved by India's Union Cabinet. The only remaining step is for both sides to agree on an Entry into Force date. Both countries are working towards doubling bilateral trade from the current USD 56 billion to USD 112 billion by 2030.

(KNN Bureau)