Medtech firms seek curbs on third-country rerouting under India-UK CETA

Domestic medical device makers have sought stricter Rules of Origin and customs safeguards under the India-UK CETA to prevent third-country rerouting of imports into India

Medical device manufacturers have sought fair competition and strong guardrails against third-country circumvention of devices with the Comprehensive Economic and Trade Agreement (Ceta) between India and the United Kingdom (UK) coming into effect on July 15.

 

The Association of Indian Medical Device Industry (AIMED), a domestic medtech manufacturers lobby, on Wednesday said that while the agreement opens doors for export growth, there remains a risk of third-country producers, especially China-based device manufacturers, exploring the reduced duty access and finding their way to India via the UK.

 

“Our concern is not limited to Chinese-origin goods but extends to European Union (EU) products that may exploit lower duty access. India has already experienced this with Singapore and the Netherlands,” said Rajiv Nath, forum coordinator at AIMED.

 

He added that Singapore and the Netherlands rank among the top five suppliers of medical devices to India despite limited domestic manufacturing because their efficient ports and tax regimes make them competitive transit hubs.

 

“By contrast, stronger production economies like Japan, Korea and Taiwan in Asia, and France, Italy and Spain in the EU are surprisingly not as prominent suppliers,” Nath said.

 

The association has further requested strict “Rules of Origin” Customs safeguards to protect India’s nascent medtech industry. Additionally, it has called for mandatory inspections to ensure that only genuine UK-origin products are shipped to India, rather than third-country goods using the UK as a transit point.

 

India exported medical devices worth $115.49 million to the UK in financial year 2024-25 (FY25), a 7 per cent year-on-year (Y-o-Y) rise from $107.40 million in FY24. On the other hand, UK medtech exports to India fell 15.8 per cent to $230.24 million in FY25, from $275.68 million in FY24.

 

The UK ranks as India’s 9th-largest device export destination, with a 2.89 per cent share, and the 11th largest import source.

 

“This reflects the wider structural feature that India still imports the majority of its medical devices, with the UK supplying sophisticated equipment that India does not yet make at scale,” Nath said.

 

With Ceta coming into effect, close to 99 per cent of Indian product lines will now enter the UK duty-free, formalising the tariff-free status of cost-competitive devices such as syringes, catheters, monitoring systems, and surgical instruments.

 

However, domestic executives noted that Indian manufacturers struggle to enter the UK market. This is due to the fair but expensive and slow regulatory approvals required by the UK’s Medicines and Healthcare products Regulatory Agency (MHRA) or the EU’s CE mark.

 

“UK manufacturers, in contrast, obtain India’s Central Drugs Standard Control Organisation (CDSCO) approvals through a relatively faster and less-expensive process that does not even involve factory inspections,” he added.

 

On the other hand, Ceta mandates that India will phase down duties on UK-origin devices from the 7.5-15 per cent band to roughly 3 per cent over a scheduled tranche, easing the cost of high-end imaging and diagnostic equipment domestically.

 

However, industry watchers say that the two flows are cleanly complementary rather than competitive.

 

Pavan Choudary, chairman at Medical Technology Association of India (MTaI), said that India’s exports to the UK are led by consumables and value-driven devices such as contact lenses, diagnostic reagents, and surgical appliances where the country’s cost advantage is decisive.

 

“Imports from the UK are concentrated on capital-intensive and technology-heavy medical equipment, such as ventilators and X-ray and diagnostic apparatus,” he added.

 

The binding question, he said, remains whether Indian firms realign procurement, manufacturing, and partnership strategies fast enough to capture the upside rather than simply absorb lower tariffs.

 

The more consequential provision is the Mutual Recognition Agreement for medical devices, which grants Indian-certified products streamlined access to the UK.

 

“The agreement opens pathways for collaboration in research and development (R&D), digital health, and skilling, reinforcing India’s stated ambition to become one of the top five global medtech manufacturing hubs by 2030,” Choudary added. 

Rules of Origin’

 

• Manufacturers flag risk of third-country routing through the UK
• Call for mandatory Customs checks to verify genuine UK-origin devices
• Nearly 99% of Indian medical device exports now get duty-free UK access
• India to gradually cut duties on UKmedical devices to 3%