India is weighing the option of withdrawing some market access concessions offered to the UK for certain items, such as Scotch whisky, under the bilateral FTA signed last year because of certain new steel restrictions imposed by Britain that would hit exports from the country, sources said.

“India needs to rebalance the FTA as the UK has come up with new import restrictions on steel. The options that we are looking at include withdrawal of certain tariff concessions on UK exports to India, including Scotch whisky,” a person tracking the development told businessline.

New Delhi’s concerns on UK steel import quotas and issues related to the Carbon Border Adjustment Mechanism (CBAM) are likely to be taken up for discussion in a meeting between Commerce & Industry Minister Piyush Goyal and UK Secretary of State for Business and Trade Peter Kyle on June 2.

“Right now, India is more bothered about the steel import quotas as the new measures will be applicable from next month. Carbon levies on exports of identified items, such as steel & aluminium and fertilisers, are still some months away. But those need to be discussed too,” the source said.

The UK has proposed steel safeguard measures under which tariff free import quotas will be slashed from July 1 2026 and duties on shipments exceeding the quota will be near-doubled to 50 per cent. 

India’s export of iron and steel to the UK in FY26 was around $900 million much of which could be hit by UK’s new steel safeguard measures, per industry estimates.

The India-UK FTA, formally called the Comprehensive Economic and Trade Agreement (CETA), concluded in July 2025 but is yet to be implemented.

If the UK does not respond positively to India’s concerns, New Delhi could take “rebalancing” measures, withdrawing certain benefits as a tit-for-tat measure. 

“The UK gained big concessions for Scotch whisky under the CETA with India agreeing to halve import duties on whisky and gin from 150 per cent to 75 per cent when the agreement comes into force, bringing it down further to 40 per cent over a 10-year period. India could consider reducing concessions here,” the source said.

There are other items, too, on which concessions could be rolled back and a final decision will be taken after consultations, the source added.

Published on June 1, 2026