India–EU Free Trade Agreement Opens European Markets, Supercharges ‘Make in India’ Exports

New Delhi, Jan 2026 : With the conclusion of the landmark India–European Union Free Trade Agreement (FTA), India has secured unprecedented market access for more than 99 per cent of its exports by trade value to the EU, a move that is expected to significantly strengthen the ‘Make in India’ initiative, the Commerce Ministry said on Tuesday. The ministry added that when combined with India’s FTAs with the United Kingdom and the European Free Trade Association (EFTA), the EU deal effectively opens up the entire European market for Indian businesses, exporters and entrepreneurs.

Describing it as the biggest trade agreement in India’s history, the ministry said the FTA is set to unlock export opportunities worth Rs 6.41 lakh crore ($75 billion). Of this, nearly $33 billion in exports from labour-intensive sectors such as textiles, leather, marine products, gems and jewellery are expected to benefit immensely from preferential access to the EU market.

Union Minister for Commerce and Industry Piyush Goyal said the conclusion of the India–EU FTA marks a defining moment in India’s global economic engagement. “This supports India’s approach to securing trusted, mutually beneficial and balanced partnerships. Beyond a conventional trade deal, it represents a comprehensive partnership with strategic dimensions and is one of the most consequential FTAs,” he said.

Highlighting India’s economic potential, Goyal noted that a young and dynamic workforce, coupled with one of the world’s fastest-growing major economies, positions the country to fully leverage the agreement. The FTA, he said, would help create jobs, spur innovation, unlock new opportunities across sectors and enhance India’s competitiveness on the global stage.

Prime Minister Narendra Modi and European Commission President Ursula von der Leyen jointly announced the conclusion of the agreement, calling it the “mother of all deals” and marking a historic milestone in India–EU economic relations and trade engagement with key global partners.

In 2024–25, bilateral trade in goods between India and the EU stood at Rs 11.5 lakh crore ($136.54 billion), with Indian exports valued at Rs 6.4 lakh crore ($75.85 billion) and imports at Rs 5.1 lakh crore ($60.68 billion). Trade in services reached Rs 7.2 lakh crore ($83.10 billion) during the same period, underscoring the depth and diversity of the economic relationship.

“Beyond goods, the agreement unlocks high-value commitments in services, complemented by a comprehensive mobility framework that enables seamless movement of skilled Indian professionals,” Goyal said.

The FTA is expected to provide a decisive boost to India’s labour-intensive sectors, including textiles, apparel, leather, footwear, marine products, gems and jewellery, handicrafts, engineering goods and automobiles. Tariffs of up to 10 per cent on nearly $33 billion worth of exports will be reduced to zero immediately upon the agreement’s entry into force.

According to the ministry, the deal goes beyond improving export competitiveness. It empowers workers, artisans, women, youth and micro, small and medium enterprises (MSMEs), while integrating Indian businesses more deeply into global value chains and reinforcing India’s role as a reliable supplier in global trade.

In the automobile sector, the agreement includes a calibrated, quota-based liberalisation package. This will allow European automakers to introduce higher-end models in the Indian market while simultaneously creating opportunities for manufacturing under the ‘Make in India’ initiative and for future exports from India. “Indian consumers will benefit from access to high-tech products and increased competition. Reciprocal market access will also open avenues for India-made automobiles in the EU market,” the ministry said.

India’s agricultural and processed food sectors are also expected to see transformative gains. Key products such as tea, coffee, spices, fresh fruits and vegetables, and processed foods will gain enhanced competitiveness in the EU market. This is expected to strengthen rural livelihoods, promote inclusive growth and reinforce India’s position as a trusted global supplier. At the same time, India has safeguarded sensitive sectors, including dairy, cereals, poultry, soymeal and select fruits and vegetables, ensuring that export growth is balanced with domestic priorities.

Beyond tariff reductions, the FTA addresses non-tariff barriers through strengthened regulatory cooperation, improved transparency, streamlined customs procedures and robust disciplines on Sanitary and Phytosanitary (SPS) measures and Technical Barriers to Trade.

In services, the agreement provides predictable access to 144 EU subsectors, including IT and IT-enabled services, professional services, other business services and education services. This is expected to significantly boost Indian service providers.

On mobility, the FTA establishes a facilitative and predictable framework for short-term, temporary and business travel in both directions. The EU has also offered commitments in 37 sectors for Contractual Service Suppliers and 17 sectors for Independent Professionals, including areas such as professional services, computer and related services, research and development, and education.

Additionally, India has secured a framework to engage constructively on Social Security Agreements over a five-year horizon, along with provisions supporting student mobility and post-study work opportunities. Together, these measures position the India–EU FTA as a comprehensive, future-oriented partnership with far-reaching economic and strategic implications.

(The content of this article is sourced from a news agency and has not been edited by the Mavericknews30 team.)