Country Graduation from the Developing Countries Trading Scheme: India
Published 4 September 2026
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Summary
India will leave the Developing Countries Trading Scheme (DCTS) on 15 July 2028 following the entry into force of the UK-India Free Trade Agreement (FTA) also known as the UK‑India Comprehensive Economic and Trade Agreement (CETA). Countries that sign an FTA with the UK graduate from the DCTS after a 2-year transition period.
During this period, businesses can continue to claim DCTS preferences or use the preferential trading arrangements available under the CETA.
Who should read this notice
- business based in the UK and import goods from India
- business based in India and export goods to the UK
- business based in countries eligible for cumulation provisions with India
Understanding why India is graduating
India currently benefits from the DCTS as a lower-middle income country. Under the Scheme’s graduation policy, countries that sign a free trade agreement with the UK leave the Scheme and transition to trading under the terms of that agreement following a two-year transition period.
The UK-India FTA entered into force on 15 July 2026. India will therefore leave the DCTS on 15 July 2028 and trade with the UK under the preferential arrangements provided by the FTA.
Retained benefits: Intra-regional cumulation in the DCTS
India is a member of the Asia Regional Cumulation Group. After India leaves the DCTS, eligible DCTS countries in the group will continue to be able to use originating materials from India when exporting goods to the UK under DCTS rules of origin provided the sourced inputs are duty-free, quota-free under the CETA. This retained benefit supports regional supply chains.
Only DCTS countries can benefit from DCTS tariff preferences and cumulation provisions. Materials exported from a DCTS country to India for final processing would be subject to the terms of the UK-India FTA.
Transition Period
To support a smooth transition for businesses in both the UK and India, the UK Government will apply a two-year transition period. During this time, India will continue to benefit from access to DCTS preferences.
FTA Entry into Force Date: 15 July 2026
End of Transition Period: 14 July 2028
Effective date of DCTS Exit: 15 July 2028
Claiming preferential tariffs during the transition period
During the two-year transition period, businesses can choose to claim preferences under either the DCTS or the UK-India FTA, provided they meet the relevant requirements of that arrangement.
To claim DCTS preferences, traders must follow the DCTS rules of origin and provide the appropriate proof of origin, such as a DCTS origin declaration or Form A. Further guidance is available at How to claim preferences under the Developing Countries Trading Scheme (DCTS) - GOV.UK.
To claim preferences under the UK-India FTA, traders must comply with the rules of origin and proof of origin requirements set out in that agreement. For more information, see here India Free Trade Agreement (enters into force on 15 July 2026) – 13 July 2026 - UK Integrated Online Tariff
DCTS and FTA proofs of origin are not interchangeable. A DCTS origin declaration or Form A cannot be used to claim preferences under the UK-India FTA, and vice versa.
Legislation
The UK Government will update relevant legislation to reflect India’s graduation from the DCTS, effective from 15 July 2028.