Market entry
Selling to India under CETA: what the trade deal actually opened
The UK–India agreement came into force on 15 July 2026 and, for the first time, opened Indian central government procurement to British suppliers. Here is where the line falls, and what still requires an Indian entity.
For as long as anyone has been selling across it, the India–UK trade relationship has had a wall down the middle of it: Indian government procurement was closed to foreign suppliers, full stop. India is not a party to the WTO's Agreement on Government Procurement, and no Indian trade agreement had ever opened it.
That changed on 15 July 2026, when the UK–India Comprehensive Economic and Trade Agreement entered into force. Chapter 15 of that agreement is the first substantive government procurement chapter India has ever signed.
Most of what has been written about CETA since covers whisky tariffs. This covers the part that decides whether a British company can sell to the Indian state — and where, very precisely, the door stops opening.
The number that decides everything
Access is not general. It applies above a threshold, and the threshold is high:
Below ₹5.5 crore, nothing has changed for you. The agreement does not reach that contract, and the pre-existing rules apply exactly as they did in June.
This single fact should reshape how a UK exporter thinks about India. It rules out most small and mid-sized opportunities, and it means the realistic candidate is a firm that can credibly deliver a contract of that size to a central government buyer. If that is not you yet, the treaty is not your route in — the sections further down are.
What "Class-II local supplier" actually buys you
The mechanism matters more than the threshold, and it is the part almost nobody in the UK has read.
Under the Public Procurement (Preference to Make in India) Order, Indian buyers must prefer Class-I local suppliers — 50% or more local content. Everyone else is at a structural disadvantage that pricing cannot fix.
CETA inserts UK suppliers into that hierarchy. A UK bidder with at least 20% UK content by value is treated as a Class-II local supplier — the status that was previously unavailable to a foreign firm at any price.
The calculation is defined, not discretionary:
| What you are selling | How UK content is calculated |
|---|---|
| Goods | (total value − non-UK imported content) ÷ total value × 100 |
| Services | (total value − imported manpower value) ÷ total value × 100 |
You will be asked to declare UK content and may need a Certificate of Origin or an Origin Declaration to support it. Treat that as a document to prepare before bidding, not after being asked.
Who is covered, and who is not
This is where most summaries stop being useful, because the exclusions are as important as the inclusions.
Covered: 51 central government ministries and departments, plus approximately 28 central public sector enterprises.
Not covered, at all:
- Defence
- Home Affairs
- Information Technology
- Space
- Every state government in India
That last exclusion deserves its own paragraph, because guidance written before July 2026 gets it backwards. It used to be reasonable to say state-level buyers were the more approachable route for a foreign supplier, being less rigid about Make in India. Under CETA the position inverts: states are outside the treaty entirely, so a UK bidder there has no rights under the agreement whatsoever and faces the same wall as before.
If your product is IT, or sells to defence or space, CETA has not opened anything for you. That is worth knowing before you commission a market entry study.
Where the tenders are published
Two portals, and you need both:
- CPPP — the Central Public Procurement Portal,
eprocure.gov.in. All central tenders above ₹2.5 lakh are published here. - GeM — the Government e-Marketplace,
gem.gov.in. Increasingly mandated for goods and services, and the platform most central buyers now transact on.
Under the agreement, notices for covered procurement are accessible free of charge. There is no paywalled aggregator you need in order to see them, whatever a reseller may tell you.
The open operational question is registration. GeM has historically required an Indian PAN, GST registration and bank account to onboard a seller, which no UK company has without an Indian entity. Whether the portal now onboards foreign suppliers for covered procurement is the practical hinge on which everything in this section turns, and we would rather tell you it is unresolved than guess.
If the treaty does not reach you
Most UK companies reading this will fall below the threshold, sell into an excluded sector, or want state and PSU business. For them the route is unchanged, and it is the one that has always worked: be Indian for procurement purposes.
Wholly owned subsidiary
Full control, eligible for public procurement, and your IP stays yours. India permits 100% FDI in most sectors under the automatic route, so no prior government approval is needed to incorporate.
Slower and more expensive than the alternatives. Realistically six to twelve months before you are bidding.
Joint venture with an Indian partner
Local market knowledge, shared risk, easier regulatory navigation — and, if the partner manufactures locally, a credible path to Class-I content levels rather than Class-II.
The costs are profit share, partner management, and genuine IP exposure. Nine to fifteen months.
Distributor
Fastest and cheapest, and the right answer for premium consumer goods. Three to six months. But your distributor bids, not you: the relationship with the buyer is theirs, and so is the margin.
Technology transfer, as an accelerant
For complex machinery and advanced manufacturing, Indian tenders reward bids that include transfer of technology — training local engineers, local service hubs, component manufacture with an Indian partner, local R&D. This is not a concession to be minimised. In categories where it applies it is frequently what decides the award.
Compliance: the three that take the longest
BIS certification
If you export electronics, steel, chemicals, automotive components or any of a long list of other categories, your products must meet Bureau of Indian Standards requirements. Foreign manufacturers certify under the Foreign Manufacturers Certification Scheme.
Budget four to eight months. This is almost always the longest lead item in an India entry, and it is the one companies discover last. Licences run one to three years with mandatory annual surveillance audits.
GST registration
Selling goods or services within India means registering for GST, from your first taxable supply. Non-resident taxable persons file monthly. India's tax administration is heavily digitised, which cuts both ways — registration is quick, and non-compliance is detected and penalised automatically.
Incorporation
Registration with the Ministry of Corporate Affairs, then PAN and TAN, then state-specific professional tax, then ongoing Companies Act obligations.
What it costs
Indicative planning ranges, not researched figures — treat them as an order of magnitude for a first budget conversation:
| Route | Indicative first-year cost |
|---|---|
| Distributor model | £28,000 – £98,000 |
| Wholly owned subsidiary | £143,000 – £395,000 |
The subsidiary figure surprises people, and the surprise is usually the certification line rather than the salaries.
Five mistakes that cost real money
- Underestimating certification. BIS is a four-to-eight month gate, not a form. Build the buffer in at the planning stage or it eats your launch window.
- Pricing without the landed cost. Even with CETA reductions there are duties, GST at 18% on most goods, and distributor margin of 15–30%. Indian buyers are value-conscious in every segment, premium included.
- Treating India as one market. Maharashtra, Karnataka, Tamil Nadu, Delhi NCR and Gujarat differ in regulation, business culture, infrastructure and talent. A national strategy that ignores this is five strategies badly done.
- Selling by email. Complex B2B in India closes face to face. Budget quarterly travel for the first two years, and expect six to eighteen month cycles.
- Assuming CETA did more than it did. It opened covered central procurement above a threshold. It did not open states, defence, IT or space, and it did not remove the need for an Indian entity below the line.
Read the primary sources
Procurement rules change and guidance is reissued, so check anything here that matters to a decision you are taking:
- UK–India CETA Chapter 15: Government Procurement — the chapter text
- Annex 15A.i — India's schedule — covered entities and thresholds, the document that decides whether you are in scope
- Government procurement opportunities in India — the UK Government's own guidance
- The full CETA text
- Public Procurement (Preference to Make in India) Order — DPIIT, for the Class-I and Class-II definitions
- Bureau of Indian Standards, Foreign Manufacturers Certification Scheme
If you find something here that has gone out of date, tell us and we will correct it.
What this means in practice
CETA did something India had never done before, and it did it narrowly. Above ₹5.5 crore, in 51 ministries and 28 public sector enterprises, outside four excluded sectors, a British company can now bid on terms that were unavailable in June — provided it can evidence 20% UK content.
Everywhere else, the answer is what it has always been: incorporate, partner, or sell through someone who already has.
The treaty removed a barrier. It did not remove the work.