Overview: The Foreign Trade Regulatory Authority of India has introduced a major operational update for commercial importers and automotive businesses across the country. By enabling specialised tariff mechanisms under the newly implemented bilateral trade framework, qualified domestic entities can now access reduced customs duties on select imported vehicle categories. Importers intending to leverage lower basic customs rates must satisfy specific authorisation criteria, secure official original manufacturer contracts, and submit their complete dossiers before the portal window closes.
In a significant move to streamline preferential trade, the governing authority for foreign trade in India has opened the first phase of online quota allocations for the 2026 calendar year. This deployment emerges from the ongoing implementation of the India-UK Comprehensive Economic and Trade Agreement (CETA).
Under this scheme, a specific volume of Completely Built Units (CBUs), covering passenger cars across varying engine displacement segments along with commercial goods transport vehicles, can be brought into the Indian domestic territory at concessional import duty slabs. This quota authorisation slashes these duties down to as low as 30% from the standard customs rates of up to 100%.
To ensure an orderly allocation process, trade authorities have set a strict two-week application window. Only verified Original Equipment Manufacturers (OEMs), authorised regional distributors, and recognised channel partners holding direct pre-purchase agreements with UK suppliers qualify to submit requests.
Core Compliance Requirements
- Submission Portal: Applications must be logged through the official digital e-Import Management System.
- Documentary Proof: Importers must upload valid pre-purchase commitments executed directly with the foreign equipment manufacturer.
- Entity Verification: Applicants must possess active business registrations, including updated Import Export Codes (IEC) and Class-3 Digital Signatures.
Quota Distribution Breakdown
| Vehicle Category & Engine Displacement | First-Phase Quota Allocation | Standard Duty Rate | Concessional TRQ Duty Rate |
|---|---|---|---|
| Small Segment Cars (Up to 1,500 cc) | 2,329 Units | 66% | 50% |
| Mid-Segment Cars (1,500 cc – 3,000 cc Petrol / 1,500 cc – 2,500 cc Diesel) | 2,329 Units | 66% | 50% |
| Premium Segment Cars (Exceeding 3,000 cc Petrol / Exceeding 2,500 cc Diesel) | 4,658 Units | 110% | 30% |
| Goods Transport Vehicles (Commercial CBUs) | 1,164 Units | 44% | 37% |
| Total First-Phase Quota | 9,316 Units | Varies | Concessional |
Frequently Asked Questions (FAQs)
What is a Tariff Rate Quota (TRQ)?
Who is eligible to apply for this vehicle quota allocation?
What is the deadline for submitting the TRQ application?
What prerequisites are required for digital portal submission?
Navigating complex EXIM regulations and tight portal deadlines can be challenging for commercial importers. SETINDIABIZ assists businesses with complete trade compliance—offering end-to-end guidance on Import Export Code (IEC) updates, digital signature registrations, document verification, and seamless DGFT portal filings to ensure your business successfully captures duty-concessional quota allocations without procedural delays.
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Author Bio
Setindiabiz Editorial Team is a multidisciplinary collective of Chartered Accountants, Company Secretaries, and Advocates offering authoritative insights on India’s regulatory and business landscape. With decades of experience in compliance, taxation, and advisory, they empower entrepreneurs and enterprises to make informed decisions.
