EU, India finalise landmark trade deal

The European Union (EU) and India have finalised a long-awaited trade deal, aiming to double EU exports to India by 2032 and save European companies 4 billion euros in tariffs. The agreement will cut or eliminate duties on 96.6 per cent of traded goods by value.

Under the agreement, India will slash tariffs on cars to 10 per cent over five years from as high as 110 per cent, and reduce duties on alcoholic beverages, machinery, chemicals, and iron and steel. The EU will cut tariffs on 99.5 per cent of goods over seven years, including marine products, leather, textiles, chemicals, rubber, base metals, and gems and jewellery.

Indian Prime Minister Narendra Modi called it “the mother of all deals,” highlighting opportunities for 1.4 billion Indians and millions in Europe. European Commission President Ursula von der Leyen described it as “making history.”

Trade between India and the EU reached $136.5 billion in the fiscal year through March 2025. The deal will be formally signed after a five- to six-month legal review and is expected to be implemented within a year.

The agreement comes amid a flurry of global trade deals as nations hedge against uncertain ties with the United States, following a failed India-US trade pact last year and rising tariffs under former President Donald Trump.

Attribution: Reuters