UK-India FTA to drive India's auto component exports, industry groups say

India exported $21.2 billion worth of auto components in FY24, 3% of which was to the UK

As India and the UK signed on the final terms of a free trade agreement (FTA) on May 6 after a three-year negotiation, auto component industry groups say that they see opportunities in technology partnerships and higher exports of auto components, which form an important part of India's merchandise exports every year. However, UK's slowing auto industry remains a concern, according to observers, even as the country's exports remain strong.

"This landmark pact opens a new chapter for bilateral trade and investment, and is a significant step toward deepening economic ties between the two nations. The Indian auto component industry looks forward to enhanced cooperation, technology partnerships, and market access through this milestone agreement," said Shradha Suri Marwah, president of the Automotive Component Manufacturers Association of India (ACMA), and the chairperson and managing director of auto parts maker Subros.

In FY24, India exported $21.2 billion worth of auto components all over the world, 3 percent of which was to the United Kingdom, according to data from ACMA. For the first half of FY25, India's auto part exports were around $11.1 billion, 7 percent higher than the same period in the year prior. Of that, around 3 percent went to the UK, the data showed. The United States is by far the largest market for Indian auto component exports.

India has an indirect presence in the UK automobile market, through Tata Motors' ownership of premium car maker Jaguar Land Rover. Other major UK brands include Aston Martin, Mini, Stellantis-owned Vauxhall, among others.

However, owing to low consumer demand amid geopolitical challenges in Europe, a transition towards electric mobility, as well as supply chain shocks, car production in the UK fell to its lowest level since 1954 to around 780,000, according to the UK's Society of Motor Manufacturers and Traders (SMMT), lower by 15 percent year-on-year.

Domestic consumption in the UK continued to slow in 2025 as well, with car production for the domestic market falling by 6 percent in March. Cars manufactured for the export market, however, increased by 31 percent year-on-year to 51,539 units, according to SMMT.