EU–India: the largest free‑trade agreement ever signed

"We have delivered the mother of all agreements," said European Commission President Ursula von der Leyen in New Delhi, emphasising that the agreement sends a strong signal in favour of cooperation based on shared rules.

An unprecedented agreement: liberalisation covering over 90% of goods

The EU and India already trade over €180 billion worth of goods and services annually, with trade in goods almost doubling over the last decade. The agreement, negotiated for almost 18 years and relaunched in 2022, now aims to double European exports to India by 2032.

Key points:

• Elimination or reduction of duties on over 90% of EU goods exported to India.

• Indian tariffs on European cars: gradually reduced from 110% to 10%.

• Tariffs on machinery, chemicals and pharmaceuticals: almost completely eliminated.

• EU wines and spirits: tariffs reduced from 150% to 75% initially, down to 20% in the long term.

• European olive oil: from 45% to zero in five years.

The EU will reduce tariffs on labour-intensive Indian products, including textiles and clothing, tea and spices, gems and jewellery, promoting greater competitiveness and the expansion of bilateral trade.

A symbolic agreement

The agreement has ‘enormous symbolic importance in a world of growing protectionism,’ but it will have no immediate macroeconomic impact on either the EU or India.

The political value, however, is clear:

• it strengthens ties with the world's fourth largest economy

• it consolidates Europe's presence in the Indo-Pacific

• it creates a stable framework for businesses in a period of global volatility

What will take place

The agreement will now have to go through a series of legal steps and ratifications before it can enter into force. Once operational, it will be accompanied by:

• a dispute resolution mechanism

• joint committees to monitor implementation

• a €500 million EU fund to support India's climate transition

• advanced standards on digital, intellectual property, sustainability and workers' rights

For Europe, this means diversification and autonomy; for India, it means privileged access to the world's largest single market.

In an era of tension and protectionism, Brussels and New Delhi are choosing the path of cooperation, sending a clear message: trade based on shared rules can still be an engine of stability and growth.

The impact for ALMEC and ALMECHATRONICS

ALMEC, together with its ALMECHATRONICS division, already operates in the Indian market with advanced electronic solutions for industrial mobility.

The EU-India agreement opens up particularly favourable prospects for our company: 

• reduction of duties on electronic components and systems 

• greater competitiveness of European products in the automation and off-highway vehicle sectors 

• a more stable regulatory framework for industrial collaborations and long-term projects 

• opportunities for expansion in a rapidly growing market that is increasingly oriented towards technological modernisation 

For ALMEC and ALMECHATRONICS, this agreement represents a strategic accelerator: a more open, predictable and favourable environment for the development of our electronic production for industrial mobility.

To discover our solutions and request a consultation with a technician, please email us at info@almec.net.

Sources:

• India-EU FTA highlights: 'Mother-of-all deals' eliminates aircraft tariffs, cuts duties on alcohol, food & chemicals - The Economic Times

• MEMO: EU-India Free Trade Agreement: Chapter-by-Chapter Summary - Trade and Economic Security

• India and Europe agree a trade deal as they contend with Trump’s tariffs | CNN