India- Eu Free Trade Deal: “Mother of all deals” Positive for India and European Nations
vrushangshah93@gmail.com Prime Minister Narendra Modi confirmed on Tuesday that India and the European Union have finalised their long-pending free trade agreement (FTA). It has taken nearly twenty years to reach this point.
For years imported cars from Europe have attracted some of the highest duties in the world. A fully built model faces taxes of about 70% to 110%. That is the single biggest reason a BMW, Audi or Mercedes costs so much more in India than it does in Europe.
Will European cars finally become cheaper? Let’s wait for the more update.
Electric cars remain outside the picture for now. European EVs are expected to stay excluded from the duty cuts for at least the first five years. India wants to protect its domestic EV investments, so electric models from BMW, Mercedes and Volvo will continue to carry a premium.
There are still key details to watch. The final tariff schedule will show which models qualify for the reduced duty. The number of cars allowed each year under the lower tariff will matter. So will the timing of the phase-down.
Auto stocks such as Mahindra & Mahindra, Hyundai Motor India and Maruti Suzuki India Ltd led the losers on the BSE Auto index on Tuesday amid concerns over heightened competition following the India-EU Free trade deal.
As per the trade deal, tariffs on EU cars will be reduced in phases to 10 per cent, subject to an annual quota of 2,50,000 vehicles, making premium imports more affordable.
Emkay Global in a note said India-EU trade relations have been improving over the years, with the bilateral trade having grown nearly 40 per cent over the last 5 years.
Ahead of the Free trade deal, Emkay Global had said the timing of the deal seems ripe and would help both nations to diversify supply chains away from concentrated geopolitical risk. After nearly two decades of negotiations, India and the European Union (EU) on Tuesday announced striking one of the largest bilateral Free trade deals concluded globally in recent years.
This is not just a trade agreement, but a new blueprint for shared prosperity- PM Modi
A ‘partnership for global good’ and a five-year strategic roadmap – PM Modi
Prime Minister Narendra Modi announced the launch of an ambitious and holistic strategic agenda for the next five years, designed to provide clear direction in a complex global environment.
He stated that the agenda will focus on advancing shared prosperity, accelerating innovation, strengthening defense cooperation, and deepening people-to-people ties.
The Prime Minister emphasized that the India-EU union is a “partnership for global good,” noting that the two powers will advance trilateral projects from the Indo-Pacific to the Caribbean and establish the India-Middle East-Europe Economic Corridor (IMEC) as a vital link for global trade.
During the joint press conference at Hyderabad House, European Commission President Ursula von der Leyen celebrated the successful conclusion of the trade negotiations with a personal message to the Prime Minister.
“PM Modi, we did it! We delivered the mother of all deals,” she declared, expressing her gratitude for the “exceptional hospitality” she received as a Chief Guest for Republic Day.
She emphasised that the agreement represents a “win-win situation” for two global giants that will create good jobs for millions of people. Von der Leyen added that the success of India makes the world more prosperous and that the deal serves as a testament to the “seriousness of our intent and the strength of our commitment.”
This trade agreement will help both India and European Union as tariffs will get reduced and it will directly benefit both the Countries so it’s a win-win situation for both the country amid global tension arises across world.
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