India–UK CETA is in force. Origin is where the money is.
The India–UK Comprehensive Economic and Trade Agreement entered into force today.
Coverage of it will focus on tariff lines and sector wins, which is fair enough — that's the headline and it's where the negotiation was. The mechanism, though, is rules of origin, and that's where the value actually gets realised or quietly lost.
Preferential rates aren't automatic
This catches firms out with every new agreement, and it catches them out the same way each time.
A trade agreement does not lower duty on goods that move between two countries. It lowers duty on goods that originate in one of them, under the specific origin rules that agreement sets out, when the importer makes a valid claim supported by the right documentation at the right moment.
Goods shipped from India are not automatically goods of Indian origin. A product assembled in India from components made in three other countries may or may not qualify, depending on the origin rule attached to that specific tariff line — and those rules vary line by line, which is precisely why the origin annex of a trade agreement is longer than the agreement.
Fail to substantiate a claim and you pay the standard rate. Claim incorrectly and you have a different and considerably worse problem, because an incorrect preference claim is an underpayment of duty with a declaration behind it.
Three ways the benefit gets lost
The most common is that nobody claims it. Preference has to be claimed at import, on the declaration. If your entries don't carry the claim, you pay full duty on goods that qualified perfectly well, and nobody sends you a notice about it. There is no counterparty whose job it is to tell you that you overpaid. This failure is completely silent and it can run for years.
The second is that the claim can't be substantiated. The claim is made at import; the evidence is generated upstream, usually by a supplier, usually months earlier, usually by somebody who had no idea it would ever be needed. Origin evidence isn't a document you produce on demand — it's a record of where components came from and what was done to them, and if nobody was keeping it, it can't be reconstructed. When the audit arrives, the trail exists or it doesn't.
The third is that the origin rule was misread. Origin rules come in several flavours: wholly obtained, change of tariff heading, value-added thresholds, specific processing requirements, and combinations of these with exceptions. The applicable rule depends on the tariff classification of the finished good.
Which means you cannot determine origin until you've determined the code. Get the classification wrong and the entire origin analysis underneath it was answering a different question correctly.
That dependency is the one worth internalising, because most operations run these as separate workstreams staffed by different people. Classification isn't adjacent to origin. It's the input to it.
What to do in the first month
Start by identifying your qualifying lines. Which of the goods you actually move are covered, and at what rate against what you're paying now. Most firms find the benefit is heavily concentrated in a small number of high-volume lines, which is good news — it makes the work finite and it makes the priority order obvious.
Then check your classification on those lines before doing anything else. Origin analysis built on a wrong code is wasted effort, and this is the step everyone skips because classification feels like settled ground. It usually isn't, particularly on assembled goods, which are exactly the goods where origin is interesting.
Then find out who generates your origin evidence. If the answer is a supplier, that's a conversation to start now rather than at audit. Suppliers who have never been asked for origin documentation take time to get right, and some of them will need to ask their own suppliers, which adds another cycle.
And decide who owns the claim. In a lot of operations the honest answer is nobody — the importer assumes the broker handles it, the broker assumes the importer will instruct them, and neither has ever said this out loud. Unclaimed preference is one of the quietest recurring costs in cross-border trade precisely because it's an absence rather than an error. Nothing fails. No exception is raised. The money simply doesn't arrive.
For this corridor specifically
India–UK has a particular shape. Substantial manufacturing and assembly on the Indian side, which means a large share of goods where origin is a genuine determination rather than an obvious one, and meaningful value riding on the answer.
That's the opposite of a corridor where origin is a formality and everything is wholly obtained. It rewards firms that do the analysis properly and penalises firms that treat the certificate as a box to tick — and the penalty arrives as either unclaimed benefit or an assessment, depending on which direction the sloppiness ran.
There's also a timing point. Agreements are most valuable in their first year, when your competitors haven't finished working out how to use them either. The firms that get their classification and origin evidence in order in the first quarter are buying an advantage that has a shelf life.
We spend a lot of our time on this corridor. If you're working out what changed for your lanes as of today, .
Next week: rules of origin explained properly, without the jargon.