India has come a step closer to signing a Free Trade Agreement (FTA) with the European Union, as senior negotiators from Europe visit New Delhi for the 15th round of discussions scheduled from November 3–7, 2025. The European delegation’s visit follows the 14th round of deliberations held in Brussels from October 27–28, 2025, where India’s Minister of Commerce and Industry, Piyush Goyal, held forward-looking bilateral discussions to resolve key outstanding issues and advance the agreement. The India–EU FTA aims to establish a balanced and equitable framework that benefits both sides.
“The engagement aims to resolve key outstanding issues and advance the agreement toward a balanced and equitable framework that benefits both India and the European Union. These consultations reaffirm the commitment of both sides to intensify engagement and facilitate a comprehensive trade agreement. Deliberations during the week will focus on core areas, including trade in goods and services, rules of origin, and other technical and institutional matters,” said a statement from India’s Ministry of Commerce.
The deliberations are guided by a shared vision of a modern, robust, and future-ready FTA that reflects the priorities and sensitivities of both India and the EU. During his Brussels visit, Minister Goyal met H.E. Maroš Šefčovič, European Commissioner for Trade and Economic Security, with both leaders agreeing to intensify engagement and facilitate progress toward a comprehensive trade framework agreement.
Significance of India-EU FTA
The India–EU Free Trade Agreement (FTA) is expected to boost bilateral trade, investment, and economic cooperation between the two economic blocs. The agreement aims to lower tariffs, streamline regulations, and provide greater market access — resulting in benefits such as increased exports for India and a more balanced supply chain for the European Union. The deal also holds significance for job creation, technology transfer, and as a strategic initiative enabling both partners to compete more effectively on the global stage.
Lower tariffs and reduced trade barriers are likely to make Indian goods more competitive in the EU market, thereby increasing exports and improving market access for Indian products. The agreement is projected to unlock billions of dollars in mutual income, stimulate gross domestic product (GDP) growth, and create employment opportunities in India — strengthening economic prospects for both sides. The FTA is also expected to encourage greater investment from European companies, thereby boosting foreign direct investment (FDI) inflows into Indian markets.
Furthermore, the FTA would help India regain a competitive edge after the withdrawal of its Generalized System of Preferences (GSP) benefits with the EU. For the European Union, India offers an attractive alternative for diversifying supply chains — a key strategic priority — while granting European producers access to India’s large and expanding consumer market. The agreement would also enable European companies to compete more effectively with rivals from the United States and China, reinforcing the EU’s strategic partnership with India, a like-minded democracy that supports rules-based trade and innovation.
The FTA is set to open new avenues for trade, investment, and deeper economic cooperation between India and the EU. It is also expected to foster joint ventures, technology partnerships, and collaborative innovation, while balancing the interests of producers, exporters, and consumers on both sides.
Bilateral trade
ndia has been the fastest-growing major economy in the world and remains an important trade partner for the European Union. The Indian government’s strong focus on sustained infrastructure expansion has made its secondary and tertiary industries more dynamic and growth-oriented. Consequently, infrastructure and allied sectors present immense opportunities for investment and participation in India’s economic growth. Global investors increasingly view India as a major market for both production and consumption, driven by its expanding population.
India’s bilateral trade with the EU has been progressing well, though there remains significant potential for further acceleration. Bilateral merchandise trade has grown substantially, reaching US$ 136.53 billion in goods, making the EU India’s largest trading partner for merchandise. Of this, India exported US$ 75.85 billion worth of goods and imported US$ 60.68 billion. Trade in services was also robust, hitting a record US$ 53 billion in 2023, with India exporting US$ 30 billion and importing US$ 23 billion.
Areas of differences
The India–EU Free Trade Agreement (FTA) has been languishing for the past seven years despite 15 rounds of negotiations. The bilateral discussions have experienced several highs and lows, particularly after the European Union’s decision in August 2025 to impose a legally binding ban on the sale of around 700 pharmaceutical products clinically tested in India. Following this setback, India postponed its scheduled meeting with EU representatives. However, in September, Commerce and Industry Minister Piyush Goyal met with EU officials and reiterated India’s intention to revive talks on the FTA. Soon after, the EU’s sanctions on Russian crude oil supplies further complicated matters, as they significantly affected Indian refineries.
A study by the European Council on Foreign Relations found that European and Indian expectations continue to diverge on issues such as tariffs on cars, wines, and dairy products imported from the EU, as well as on the liberalisation of visa regimes for Indian professionals seeking to work in Europe. This debate intensified following U.S. President Donald Trump’s decision to raise H1B visa fees to US$ 100,000, which disproportionately impacts Indian professionals — who account for nearly 60 percent of H1B visa holders. Consequently, more flexible visa norms under the FTA would particularly benefit Indian professionals entering the European Union.
The EU and India have also been involved in trade disputes at the World Trade Organization (WTO) over wine and spirits, as well as pharmaceuticals. When FTA negotiations began, India maintained high tariffs in sectors of interest to the EU and imposed restrictions on foreign direct investment (FDI) in several industries, including insurance and trade. Since then, India has relaxed FDI rules in insurance, wholesale trade, and single-brand retail. However, tariffs on goods such as wines and cars remain high, ranging between 60 and 100 percent. Notably, in March 2024, India signed a Trade and Economic Partnership Agreement (TEPA) with Switzerland, Iceland, Liechtenstein, and Norway.
DILIP KUMAR JHA
Editor
dilip.jha@polymerupdate.com
