Published on: January 30, 2026

INDIA–EU FREE TRADE AGREEMENT CONCLUDED

INDIA–EU FREE TRADE AGREEMENT CONCLUDED

news: The Prime Minister and European Commission President H.E Ms. Ursula von der Leyen, today jointly announced the conclusion of the India–European Union Free Trade Agreement (India–EU FTA) at the 16th India–EU Summit

ABOUT

  • Positions India and the European Union as trusted partners committed to open markets, predictability, and inclusive growth.
  • The India–EU FTA is a comprehensive and modern trade pact designed to eliminate or significantly reduce tariffs on goods, liberalize trade in services, and enhance investment flows.
  • Dubbed the “mother of all deals,”.

KEY FEATURES

  • Gives a decisive boost to its labour-intensive sectors such as textiles, apparel, leather etc: bringing down tariffs up to 10% on almost 33 bn USD of exports to zero on entry into force of the Agreement
  • Enhanced market access for India in 144 EU services sub-sectors such as IT, finance, and education, along with a new mobility framework easing visas for skilled professionals, intra-corporate transferees, and AYUSH practitioners.
  • The EU will grant duty-free access to over 99% of Indian exports by value, while India will gradually eliminate tariffs on about 92–97% of EU goods.
  • Provisions addressing the EU’s Carbon Border Adjustment Mechanism (CBAM), including technical assistance and dialogue to help Indian MSMEs meet green compliance standards.
  • Eases movement of employees of Indian corporates, business entities, and independent professionals.

SIGNIFICANCE

  • Preferential access to a 450-million-consumer EU market will significantly boost Make in India exports.
  • Lowers over-reliance on the US and China amid shifting global geopolitics.
  • Relaxed mobility norms enable Indian professionals and students to integrate into the EU economy, including 9-month post-study work opportunities.
  • Improved market access for tea, coffee, and spices will directly uplift farmers and rural artisans.
  • European businesses are expected to save approximately €4 billion annually in duties on exports to India.
  • A predictable legal environment for European firms to expand operations in India.