Historic free trade agreement signed today between the EU and India
Tariff reductions of 4 billion euros per year in duties on European products, including agri-food products such as wine and oil
The EU and India today concluded negotiations for a "historic, ambitious, and commercially significant" free trade agreement (FTA), considered the largest agreement of its kind ever concluded by either side. The agreement, the official statement from Brussels emphasizes, "will strengthen economic and political ties between the world's second- and fourth-largest economies, at a time of rising geopolitical tensions and global economic challenges, highlighting their shared commitment to economic openness and rules-based trade."
"The EU and India," emphasized European Commission President Ursula von der Leyen , "are making history today, deepening the partnership between the world's largest democracies. We have created a free trade area of 2 billion people, with both sides set to benefit economically. We have sent a signal to the world that rules-based cooperation still delivers great results. And, importantly, this is just the beginning: we will build on this success and further strengthen our relationship."
The EU and India already trade goods and services worth over €180 billion annually, supporting nearly 800,000 jobs in the EU. This agreement is expected to double EU goods exports to India by 2032, eliminating or reducing customs duties on 96.6% of EU goods exports to India.
Overall, the tariff reductions will save approximately €4 billion annually in duties on European products. This is the most ambitious trade opening India has ever granted to a trading partner. It will provide a significant competitive advantage to the EU's key industrial and agri-food sectors, granting companies privileged access to the world's most populous country, with 1.45 billion people and the fastest-growing economy, with an annual GDP of €3.4 trillion.
Opportunities for European businesses of all sizes
India will grant the EU tariff reductions that no other trading partner has received. For example, tariffs on cars are gradually being reduced from 110% to a minimum of 10%, while they will be completely eliminated for auto parts after five to ten years. Customs duties of up to 44% on machinery, 22% on chemicals, and 11% on pharmaceuticals will also be largely eliminated.
A dedicated chapter will also help small EU businesses take full advantage of new export opportunities. For example, both sides will establish dedicated contact points to provide SMEs with relevant information on the FTA and assist them with specific issues they may encounter in using its provisions. Furthermore, SMEs will particularly benefit from the tariff reductions, elimination of regulatory barriers, transparency, stability, and predictability guaranteed by the agreement.
Reduction of agri-food duties
The agreement eliminates or reduces often prohibitive tariffs (averaging over 36%) on EU agri-food exports, opening up a huge market for European farmers. For example, Indian tariffs on wine will be reduced from 150% to 75% upon entry into force, and then to 20%; tariffs on olive oil will drop from 45% to 0% over five years; and processed agricultural products such as bread and confectionery will see tariffs eliminated by up to 50%.
Sensitive European agricultural sectors will be fully protected, as products such as beef, chicken, rice, and sugar are excluded from the liberalization envisaged by the agreement. All Indian imports will continue to comply with stringent EU health and food safety standards. In parallel, the EU and India are currently negotiating a separate agreement on Geographical Indications (GIs), which will help traditional and iconic EU agricultural products sell more in India by eliminating unfair competition in the form of imitations.
Privileged access to services markets and protected intellectual property
The agreement will grant EU companies privileged access to the Indian services market, including key sectors such as financial services and maritime transport. The agreement includes India's most ambitious financial services commitments in any trade agreement, going beyond those made with other partners.
The agreement provides for a high level of protection and enforcement of intellectual property (IP) rights, including copyright, trademarks, designs, trade secrets, and plant variety patents. It builds on existing international IP treaties and aligns Indian and EU IP laws. This will make it easier for EU and Indian companies that rely on IP to trade and invest in each other's markets.
"The EU and India," emphasized European Commission President Ursula von der Leyen , "are making history today, deepening the partnership between the world's largest democracies. We have created a free trade area of 2 billion people, with both sides set to benefit economically. We have sent a signal to the world that rules-based cooperation still delivers great results. And, importantly, this is just the beginning: we will build on this success and further strengthen our relationship."
The EU and India already trade goods and services worth over €180 billion annually, supporting nearly 800,000 jobs in the EU. This agreement is expected to double EU goods exports to India by 2032, eliminating or reducing customs duties on 96.6% of EU goods exports to India.
Overall, the tariff reductions will save approximately €4 billion annually in duties on European products. This is the most ambitious trade opening India has ever granted to a trading partner. It will provide a significant competitive advantage to the EU's key industrial and agri-food sectors, granting companies privileged access to the world's most populous country, with 1.45 billion people and the fastest-growing economy, with an annual GDP of €3.4 trillion.
Opportunities for European businesses of all sizes
India will grant the EU tariff reductions that no other trading partner has received. For example, tariffs on cars are gradually being reduced from 110% to a minimum of 10%, while they will be completely eliminated for auto parts after five to ten years. Customs duties of up to 44% on machinery, 22% on chemicals, and 11% on pharmaceuticals will also be largely eliminated.
A dedicated chapter will also help small EU businesses take full advantage of new export opportunities. For example, both sides will establish dedicated contact points to provide SMEs with relevant information on the FTA and assist them with specific issues they may encounter in using its provisions. Furthermore, SMEs will particularly benefit from the tariff reductions, elimination of regulatory barriers, transparency, stability, and predictability guaranteed by the agreement.
Reduction of agri-food duties
The agreement eliminates or reduces often prohibitive tariffs (averaging over 36%) on EU agri-food exports, opening up a huge market for European farmers. For example, Indian tariffs on wine will be reduced from 150% to 75% upon entry into force, and then to 20%; tariffs on olive oil will drop from 45% to 0% over five years; and processed agricultural products such as bread and confectionery will see tariffs eliminated by up to 50%.
Sensitive European agricultural sectors will be fully protected, as products such as beef, chicken, rice, and sugar are excluded from the liberalization envisaged by the agreement. All Indian imports will continue to comply with stringent EU health and food safety standards. In parallel, the EU and India are currently negotiating a separate agreement on Geographical Indications (GIs), which will help traditional and iconic EU agricultural products sell more in India by eliminating unfair competition in the form of imitations.
Privileged access to services markets and protected intellectual property
The agreement will grant EU companies privileged access to the Indian services market, including key sectors such as financial services and maritime transport. The agreement includes India's most ambitious financial services commitments in any trade agreement, going beyond those made with other partners.
The agreement provides for a high level of protection and enforcement of intellectual property (IP) rights, including copyright, trademarks, designs, trade secrets, and plant variety patents. It builds on existing international IP treaties and aligns Indian and EU IP laws. This will make it easier for EU and Indian companies that rely on IP to trade and invest in each other's markets.
Strengthening commitments to sustainability
The agreement contains a chapter dedicated to trade and sustainable development, which strengthens environmental protection and addresses climate change, protects workers' rights, supports women's empowerment, provides a platform for dialogue and cooperation on trade-related environmental and climate issues, and ensures their effective implementation.
The EU and India will also sign a Memorandum of Understanding to establish an EU-India Platform for Cooperation and Support for Climate Action. The Platform will be launched in the first half of 2026. Furthermore, in accordance with EU budgetary and financial rules and procedures, EU support of €500 million over the next two years is envisaged to support India's efforts to reduce greenhouse gas emissions and accelerate its long-term sustainable industrial transformation.
Next steps
On the EU side, the negotiated draft texts will be published shortly. The texts will undergo legal review and translation into all official EU languages. The Commission will then submit its proposal to the Council for signature and conclusion of the agreement. Once adopted by the Council, the EU and India will be able to sign the agreements. After signature, the agreement requires the approval of the European Parliament and a Council decision on its conclusion for it to enter into force. The agreement can only enter into force after ratification by India.
Premise
The EU and India launched negotiations for a free trade agreement in 2007. Talks were suspended in 2013 and resumed in 2022. The 14th and final formal round of negotiations took place in October 2025, followed by intersessional discussions at the technical and political levels. Simultaneously with the resumption of FTA negotiations, the EU and India also launched negotiations for a Geographical Indications Agreement and an Investment Protection Agreement. Negotiations on these agreements are ongoing.
The agreement contains a chapter dedicated to trade and sustainable development, which strengthens environmental protection and addresses climate change, protects workers' rights, supports women's empowerment, provides a platform for dialogue and cooperation on trade-related environmental and climate issues, and ensures their effective implementation.
The EU and India will also sign a Memorandum of Understanding to establish an EU-India Platform for Cooperation and Support for Climate Action. The Platform will be launched in the first half of 2026. Furthermore, in accordance with EU budgetary and financial rules and procedures, EU support of €500 million over the next two years is envisaged to support India's efforts to reduce greenhouse gas emissions and accelerate its long-term sustainable industrial transformation.
Next steps
On the EU side, the negotiated draft texts will be published shortly. The texts will undergo legal review and translation into all official EU languages. The Commission will then submit its proposal to the Council for signature and conclusion of the agreement. Once adopted by the Council, the EU and India will be able to sign the agreements. After signature, the agreement requires the approval of the European Parliament and a Council decision on its conclusion for it to enter into force. The agreement can only enter into force after ratification by India.
Premise
The EU and India launched negotiations for a free trade agreement in 2007. Talks were suspended in 2013 and resumed in 2022. The 14th and final formal round of negotiations took place in October 2025, followed by intersessional discussions at the technical and political levels. Simultaneously with the resumption of FTA negotiations, the EU and India also launched negotiations for a Geographical Indications Agreement and an Investment Protection Agreement. Negotiations on these agreements are ongoing.
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EFA News - European Food Agency
EFA News - European Food Agency