India-EU FTA Nears Finish Line: 96% Tariff Cuts, €4 Billion Savings And More: Here's A Look At What The Deal Offers

(MENAFN- Live Mint) India and the European Union on Friday moved closer to finalising a landmark free trade agreement (FTA), with the European Commission seeking approval for its signature and conclusion. If authorised by the Council, this will be the largest trade agreement ever concluded by both the EU and India.

The EU and India already trade over €180 billion in goods and services per year, supporting nearly 800,000 EU jobs. Once the FTA is adopted and entered into force, it will improve market access, reduce tariffs, tackle unnecessary barriers to trade, and provide predictable rules for trade and investment between the two countries.

The EU and India started negotiating an FTA in 2007. The talks were suspended in 2013, relaunched in 2022, and successfully concluded in January 2026. Alongside the free trade agreement, the EU and India are also negotiating agreements on geographical indications and investment protection. The FTA is expected to come into force by later this year or in the first half of 2027.

Here are the key benefits of the India-EU FTA:

This deal will eliminate or reduce tariffs on 96% of EU goods exports to India. Overall, the tariff reductions will save around €4 billion per year in duties on European products. Lower tariffs and reduced trade barriers could give consumers in both markets greater choice and access to products at more competitive prices. It will remove unnecessary barriers to trade and establish more predictable rules for trade and investment, helping companies plan and expand across the two markets.

'Bold leap for two economic powerhouses'

Hailing the landmark India-EU FTA moving "one step closer to the finish line”, European Ambassador-designate to India and Bhutan Jean-Eric Paquet on Friday said that the proposal is a“bold leap for two economic powerhouses”.

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The ambassador-designate's comment comes shortly after the European Commission presented the agreement to the EU Council for approval, as he said the agreement has cleared the path for early approval.

“Fantastic news! FTA just moved one step closer to the finish line! @EU_Commission has sent its proposal to @EUCouncil, clearing the path for early approval; while the full text is now public,” Ambassador-designate Paquet posted on X.

Sharing the text of the proposed text in his post, he added that the proposal“is not just another agreement. It's a bold leap for two economic powerhouses!”

India ranks as the EU's ninth-largest trading partner in goods, with bilateral merchandise trade reaching EUR 118 billion in 2025. Machinery, transport equipment, and chemicals account for the bulk of EU exports to India, while Indian shipments to Europe primarily consist of machinery, chemicals, textiles, metals, and refined petroleum products.

Also Read | How is India's trade faring with FTA partners?

Trade in services between the two economies reached EUR 67 billion in 2025, with EU service imports totalling EUR 37.8 billion and exports EUR 29.2 billion.

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