The India–EU FTA marks a major milestone in one of India’s most strategic economic partnerships, concluding negotiations on a modern, rules-based trade agreement between the world’s 4th and 2nd largest economies. With a combined market of over INR 2091.6 lakh crore (USD 24 trillion), the agreement unlocks significant opportunities for trade and innovation, offering market access for over 99% of India’s exports by value while safeguarding sensitive sectors.
Bilateral trade between India and the EU has shown steady growth, with merchandise trade at INR 11.5 lakh crore (USD 136.54 billion) and services trade at INR 7.2 lakh crore (USD 83.10 billion). By providing a stable and predictable framework, the FTA addresses untapped trade potential, strengthens India–EU economic ties, and enables Indian businesses, including MSMEs, to integrate more deeply into European value chains amid global economic uncertainties.
Empowering Businesses and Securing Future through seamless Market Access
India Secures Strategic Access to European Markets
India has gained preferential access to the European markets across 97% of tariff lines, covering 99.5% of trade value, in particular:
- 70.4% tariff lines covering 90.7% of India’s exports will have immediate duty elimination for important labour-intensive sectors such as textiles, leather and footwear, tea, coffee, spices, sports goods, toys, gems and jewellery and certain marine products, amongst others;
- 20.3% tariff lines covering 2.9% of India’s exports will have zero duty access over 3 and 5 years for certain marine products, processed food items, arms and ammunition, amongst others;
- 6.1% tariff lines covering 6% of India’s exports will have preferential access by way of tariff reduction for certain poultry products, preserved vegetables, bakery products amongst others or through TRQs for cars, steel, certain shrimps/ prawns products, amongst others.
Key labour-intensive sectors—including textiles, apparel, marine products, leather, footwear, chemicals, plastics and rubber, sports goods, toys, gems and jewellery—accounting for over INR 2.87 lakh crore (USD 33 billion) in exports and currently facing EU duties of 4% to 26%, will gain zero-duty access from the FTA’s entry into force. This tariff elimination will significantly enhance competitiveness, support employment generation, and enable deeper integration into European and global value chains.
India’s offer to the European Union
Overall, India is offering 92.1% of its tariff lines which covers 97.5% of the EU exports, in particular:
- 49.6% of tariff lines will have immediate duty elimination;
- 39.5% of tariffs lines are subject to phased elimination over 5, 7, and 10 years’
- 3% of products are under phased tariff reductions and few products are subject to TRQs for Apples, Pears, Peaches, Kiwi Fruit.
Imports of EU’s high technology goods are expected to diversify India’s import sources, thereby reducing input costs for businesses, benefit consumers and will create opportunities for Indian businesses to integrate into global supply chains.
Driving Agricultural Growth and Farmer Livelihoods, with adequate Safeguards
The FTA is expected to significantly benefit India’s agricultural and processed food sectors by providing preferential market access for products such as tea, coffee, spices, grapes, gherkins, cucumbers, dried onion, fresh fruits, vegetables, and processed foods, enhancing their competitiveness in the EU. This access will strengthen farmer incomes, support rural livelihoods, and improve global competitiveness, while sensitive sectors—including dairy, cereals, poultry, soymeal, and select fruits and vegetables—remain safeguarded to balance export growth with domestic priorities and ensure long-term agricultural resilience.
Product Specific Rules aligned with existing Supply Chains
India–EU FTA mandates adequate processing or manufacturing for goods to qualify for originating status and preferential access, with balanced Product Specific Rules (PSRs) aligned to existing supply chains. These rules ensure substantial value addition while allowing flexibility to source global inputs. To ease compliance, the agreement permits self-certification through a Statement of Origin, reducing time and costs for exporters. The PSRs are MSME-friendly, providing quotas for shrimp, prawn and downstream aluminium products, and support Make in India through transition periods for select machinery and aerospace sectors.
Services-the key growth driver of trade in future
Services, as the fastest-growing component of both economies, are expected to expand significantly under the FTA, supported by assured market access, non-discriminatory treatment, digitally delivered services, and improved mobility. The EU has made commitments across 144 services subsectors, including IT/ITeS, professional, education, and business services, providing Indian service providers a stable operating environment. India’s offer across 102 subsectors—covering EU priorities such as telecommunications, financial, maritime, and environmental services—creates a predictable investment regime. This balanced framework is set to boost services trade, enhance opportunities for professionals and businesses, and strengthen India’s position in high-value, knowledge-driven global markets.
Powering India’s Talent across Europe
India–EU FTA provides an assured framework for the temporary entry and stay of professionals, including business visitors, intra-corporate transferees, contractual service suppliers, and independent professionals. A comprehensive mobility regime facilitates movement of employees of Indian companies in the EU, along with their spouses and dependents, across all services sectors. Indian firms gain access to 37 services sub-sectors, while independent professionals receive certainty in 17 sub-sectors covering IT, R&D, and higher education. The agreement also lays the groundwork for future Social Security Agreements and supports continued mobility for Indian students, including post-study work opportunities.
Expanding Horizons for Indian Traditional Medicine
The FTA is expected to provide a boost to Indian traditional medicine services and practitioners. In the EU Member States where regulations do not exist, AYUSH practitioners will be able to provide their services using the professional qualifications they gain in India.
The FTA also provides future certainty and locks in the openness of the EU for establishment of AYUSH wellness centres and clinics in the EU Member States. The FTA also envisages greater exchange with the EU to facilitate trade in Indian Traditional Medicine services.
Innovate, Protect, Prosper: Elevating Intellectual Property
The FTA reinforces intellectual property protections provided under TRIPS relating to copyright, trademarks, designs, trade secrets, plant varieties, enforcement of IPRs, affirms Doha Declaration and recognises the importance of digital libraries, specifically the Traditional Knowledge Digital Library (TKDL) project initiated by India. The IPR chapter provides for exchanging views and information on their respective laws and practices relating to the transfer of technology, including measures to facilitate information flows, business partnerships, etc.
Strengthening SPS and TBT Links for Safe, Standardised, Seamless trade
The FTA introduces enhanced cooperation on SPS and TBT matters. It will facilitate recognition of conformity assessment results, enabling equivalence on SPS measures on technical justification and localised responses to pest/ disease outbreaks. Through digitisation, information sharing, and adherence to international standards, the FTA reduces trade barriers, facilitates smoother market access, and strengthens regulatory predictability for exporters.
Sectoral gains under the India–EU FTA
Harvesting Growth beyond Farms: Preferential Access Fuels Agri Growth
India gains preferential market access for a wide range of agricultural exports, including processed foods, tea, coffee, spices, table grapes, gherkins, cucumbers, sheep and lamb meat, sweet corn, dried onion, and select fruits and vegetables, enhancing their competitiveness in Europe. This access will boost rural incomes, increase women’s participation, and strengthen India’s image as a premium and reliable supplier, while strategic safeguards for sensitive sectors such as dairy, cereals, poultry, soymeal, and select produce protect domestic priorities alongside export growth.
Accelerating Exports through Engineering Excellence
With preferential market access for engineering goods presently facing tariffs as high as 22%, the FTA is expected to enhance India’s exports to the EU, which stood at approximately INR 1.44 Lakh Crore (USD 16.6 billion), and improve share in EU’s nearly INR 174.3 Lakh Crore (USD 2 trillion) engineering goods imports. The FTA is poised to empower MSME-led industrial hubs, catalysing industrial modernisation and global competitiveness.
Jobs and Growth: Labour-Intensive Industries Gain Competitiveness
Sectors like textiles, leather, footwear, marine, sports goods, toys, and gems and jewellery gain enhanced competitiveness through tariff elimination, supporting employment generation and EU market integration.
Stepping Up India’s Leather & Footwear exports in Europe
India’s leather and footwear sector, driven by skilled craftsmanship and MSME innovation, is set to significantly expand its presence in the European market. The elimination of tariffs—reduced from up to 17% to zero at the FTA’s entry into force—will enhance competitiveness of India’s exports valued at INR 20.9 thousand crore (USD 2.4 billion) and support greater participation in the EU’s USD 100 billion import market. Regulatory alignment, easier compliance, and encouragement for design-led, sustainable products will help the sector move towards higher-value global leadership.
Marine Exports to get a Major Boost
Preferential access covering 100% of trade value, by reducing tariffs of up to 26% will unlock the EU marine market for imports (INR 4.67 Lakh Crore (USD 53.6 billion)). This enhanced market access is expected to significantly improve the competitiveness of India’s marine exports, while complementing and strengthening India’s export capacity in the marine sector, currently valued at INR 8,715 Crore (USD 1 billion) to the EU. The FTA will turbo-charge exports of shrimp, frozen fish, and value-added seafood exports, empowering coastal communities in Andhra Pradesh, Gujarat, Kerala, and beyond and India’s blue economy.
India’s Medical Instruments, Appliances, and vital Supplies
India’s medical Instruments, Appliances, and vital Supplies built on cutting-edge manufacturing, innovation, and skilled talent is set for a quantum leap in the EU. Tariffs of up to 6.7% eliminated across 99.1% of trade lines, enabling cost-competitive entry in European markets for lenses, spectacles, medical devices, measuring and testing instruments.
Promoting India’s Jewellery Export and creating enormous Job opportunities
The gems and jewellery sector, a blend of artistry, MSME entrepreneurship, and heritage craftsmanship, becomes more competitive in the EU market. From tariffs of up to 4% previously to gaining preferential access across 100% of trade value, India’s INR 23.5 thousand Crore (USD 2.7 Billion) jewellery exports become competitive through the FTA in INR 6.89 Lakh Crore (USD 79.2 billion) import market.
Threading Success: Textiles & Apparel high achievers
Gaining zero duty access in textiles and clothing, covering all tariff lines and reducing tariffs by up to 12%, would open up the EU’s INR 22.9 Lakh Crore (USD 263.5 billion) import market. Building on India’s current INR 3.19 Lakh Crore (USD 36.7 billion) in global textile and apparel exports, including INR 62.7 Thousand Crore (USD 7.2 billion) to the EU, such access would significantly expand opportunities, particularly in yarn, cotton yarn, cotton yarn, man-made fibre apparel, Ready-Made Garments, men’s and women’s clothing and home textiles. This would enable MSMEs to scale, generate employment, and reinforce India’s positioning as a reliable, sustainable, and high-value sourcing partner.
Plastics & Rubber exports to benefit extensively
India’s plastic and rubber industries will gain preferential access to the EU, a market with global imports valued at INR 27.67 Lakh Crore (USD 317.5 billion). With India’s current exports to the EU at INR 20.9 thousand Crore (USD 2.4 billion) and total global exports of INR 1.13 Lakh Crore (USD 13 billion), this access underscores substantial scope for growth. Enhanced access under FTA combined with India’s skilled manufacturing workforce and MSME-driven innovation, positions the country to increase employment, boost exports, and strengthen its global trade profile.
Chemicals: Expanding Exports, Generating Employment
FTA ensures zero duty on 97.5% of India’s chemical export basket by value, eliminating duties of up to 12.8% and boosting competitiveness across inorganic, organic, and agrochemicals. The FTA is expected to expand exports, strengthen MSME-led clusters and promote high-value, sustainable, and technologically advanced products, positioning India as a trusted supplier to EU’s nearly INR 43.57 Lakh Crore (USD 500 billion) chemical market for imports.
Unlocking opportunities in Mines and Minerals
Zero duty across 100% of tariff lines breaks cost barriers, ensuring India exports quality, reliable, and value-added minerals to the EU. The FTA unlocks opportunities to scale India’s presence in Europe’s high-value markets, while long-term, predictable access fuels partnerships with European manufacturers in steel, electronics, automotive, and renewable energy.
Significant Market Access for Home Décor, Wooden Crafts and Furniture
Lower duties of up to 10.5% provides enhanced access, boosting the competitiveness of Indian wooden, bamboo, and handcrafted furniture. The FTA supports growth in high-value, design-oriented segments and strengthens India’s role in global furniture supply chains.
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