India-EU Free Trade Agreement: Cars, Wine, Chocolates Among 30+ Products Set to Get Cheaper
The recently concluded India–EU Free Trade Agreement (FTA) is expected to significantly reduce tariffs on a wide range of imported goods, offering potential price relief to Indian consumers. Products spanning automobiles, machinery, pharmaceuticals, chocolates, wine and processed foods are among those likely to become cheaper once the deal comes into force.
India-EU FTA: What Has Been Agreed
Prime Minister Narendra Modi confirmed on Tuesday that India and the European Union have finalised the long-pending trade pact. According to a fact sheet released by the European Commission, the agreement aims to eliminate or sharply reduce existing high import duties.
At present, tariffs on certain European goods remain steep — up to 44% on machinery, 22% on chemicals, and around 11% on pharmaceuticals. Most of these duties are expected to be phased out under the new trade framework.
Full List: Products Likely to Get Cheaper
Under the India-EU FTA, more than 30 product categories are expected to benefit from tariff reductions. These include:
- Cars and auto components
- Industrial machinery and electrical equipment
- Chemicals and pharmaceuticals
- Wine and beer
- Chocolates and confectionery
- Olive oil
- Processed meat products such as sausages
- Food preparations and packaged goods
The tariff cuts are expected to boost European exports to India while increasing consumer choice and competition in the domestic market.
When Will the Agreement Take Effect?
Although negotiations have concluded, the trade deal is yet to come into force. Officials said the agreement will be formally signed after legal vetting, a process that may take around six months. The pact will also require approval from the European Parliament.
Steps Required Before Implementation
According to an official release, the European Union must complete the following steps before the agreement becomes operational:
Publication of the negotiated draft texts
Legal review and translation into all official EU languages
Proposal of the agreement to the European Council for signature
Adoption by the Council
Formal signing of the agreement between India and the EU
Approval by the European Parliament
Final Council decision allowing the agreement to enter into force
Ratification by India
Only after both sides complete their ratification processes will the FTA be implemented.
‘Mother of All Trade Deals’
Describing the pact as the “mother of all trades”, Prime Minister Modi highlighted its global significance during a meeting with Ursula von der Leyen and European Council President Antonio Costa at Hyderabad House.
“This agreement represents nearly 25% of global GDP and about one-third of global trade,” PM Modi said, adding that the deal will open new economic opportunities for India’s 1.4 billion people and millions across the European Union.
India–EU Free Trade Agreement: Products and Tariff Changes
|
Product Category |
Current Import Tariffs |
Tariffs Under India-EU FTA |
|
Machinery & Electrical Equipment |
Up to 44% |
0% for almost all products |
|
Aircraft & Spacecraft |
Up to 11% |
0% for almost all products |
|
Optical, Medical & Surgical Equipment |
Up to 27.5% |
0% for 90% of products |
|
Up to 16.5% |
0% for almost all products |
|
|
Pearls, Precious Stones & Metals |
Up to 22.5% |
0% for 20% of products; tariff cuts for another 36% |
|
Chemicals |
Up to 22% |
0% for almost all products |
|
110% |
10% (within a quota of 250,000 units) |
|
|
Iron & Steel |
Up to 22% |
0% for almost all products |
|
Pharmaceuticals |
11% |
0% for almost all products |
|
Wine |
150% |
20% (premium range); 30% (medium range) |
|
Up to 150% |
40% |
|
|
110% |
50% |
|
|
Olive Oil, Margarine & Other Vegetable Oils |
Up to 45% |
0% |
|
Kiwis & Pears |
33% |
10% (within quota) |
|
Fruit Juices & Non-Alcoholic Beer |
Up to 55% |
0% |
|
Processed Foods (bread, pastries, biscuits, pasta,
chocolate, pet food) |
Up to 50% |
0% |
|
33% |
0% |
|
|
Sausages & Other Meat Preparations |
Up to 110% |
50% |
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