Summary
India and the EU (European Union) concluded negotiations for a FTA (Free Trade Agreement) on 27 January 2026. Legal scrubbing of the agreement was completed on 20 August 2026, bringing the deal closer to signing.
The EU has agreed to eliminate tariffs on more than 90% of tariff lines, covering 91% of the value of its goods imports from India.
The figure is significant, but it does not mean that 91% of Indian products will immediately become duty-free. Tariff reductions will vary by product, with some taking effect when the agreement enters into force and others being phased in over several years.
Indian exporters will also have to meet the agreement’s Rules of Origin and continue complying with EU product and safety requirements.
India–EU FTA: Key facts
| Key point | Details |
| Negotiations concluded | 27 January 2026 |
| Legal scrubbing completed | 20 August 2026 |
| Expected signing | By end-2026 |
| EU tariff lines with tariffs eliminated | More than 90% |
| Value of EU imports from India covered | 91% |
| India’s tariff lines with tariffs eliminated | 86% |
| Value of Indian imports from EU covered | 93% |
| EU goods imports from India in 2024 | €71 billion |
The 91% figure applies to EU imports from India, while the 93% figure applies to India’s imports from the EU. They therefore measure tariff liberalisation on opposite sides of the trade relationship.
From negotiations to signing
India and the EU agreed to resume trade negotiations in May 2021. Formal FTA talks restarted on 17 June 2022.
The two sides agreed to accelerate the negotiations in February 2025 and concluded them on 27 January 2026.
The latest development came on 20 August 2026, when legal scrubbing of the agreement was completed. The pact is expected to be signed by the end of 2026, although the exact date has not yet been announced.
The agreement is not yet in force. After signing, it will still have to complete the required internal procedures before the new tariff arrangements become applicable.
What does 91% tariff coverage mean?
The EU’s commitment covers more than 90% of tariff lines and 91% of the value of goods imported from India.
A tariff line is a customs classification for a specific product. The 91% figure is based on the value of actual trade, not the number of products.
The agreement also provides for partial tariff reductions on additional products. Including these reductions, overall liberalisation reaches 99.3% for the EU and 96.6% for India.
For Indian exporters, the important point is that tariff treatment will differ from product to product.
Not every product will become duty-free immediately
Some tariffs will be removed when the agreement enters into force. Others will be reduced gradually.
For certain products, the phase-out can take five, seven or up to 10 years. The European Commission, for example, says most tariffs on textiles and apparel will be removed at entry into force, while some pharmaceutical tariff reductions will take longer.
Exporters will therefore need to check the tariff schedule for their specific HS (Harmonized System) code rather than relying on the 91% headline figure.
Which Indian sectors could benefit?
The European Commission identifies textiles, footwear, chemicals, pharmaceuticals and fisheries among the Indian sectors that could gain from the agreement.
Textiles and apparel
Most tariffs on textiles and apparel are expected to be removed when the agreement enters into force.
This could reduce the cost of Indian textile and clothing exports in the EU market and give businesses more flexibility on pricing and margins.
Chemicals
Lower tariffs could make Indian chemical products more competitive in Europe by reducing the customs cost attached to imports.
This may help existing exporters and make the market more attractive to companies looking to expand their EU business.
Footwear
Indian footwear exporters could also benefit from lower duties. Because footwear is a price-sensitive market, tariff reductions could improve the position of Indian suppliers competing for European buyers.
Pharmaceuticals
Pharmaceuticals are another important area. The European Commission says tariffs on almost all pharmaceutical products will eventually fall to zero, although some reductions will be phased in over as long as 10 years.
The tariff benefit, however, does not remove the EU’s regulatory requirements for pharmaceutical products.
Rules of Origin will determine who gets the tariff benefit
The lower tariffs will apply only to products that meet the FTA’s Rules of Origin.
These rules determine whether a product qualifies as originating in India. They are particularly important for manufacturers that use imported raw materials, components or other inputs.
The agreement provides for a statement on origin that exporters can use to claim preferential treatment. Businesses will need records to support their claims, and customs authorities can verify them.
For companies, this means supply-chain records and origin documentation will become important when claiming the preferential tariff.
EU regulations will still apply
The FTA will reduce tariffs, but it will not remove EU regulatory requirements.
Indian exporters will still have to comply with relevant European rules on product safety, technical standards and market access.
For food, agricultural and fisheries products, the EU’s SPS (Sanitary and Phytosanitary) requirements will continue to apply. The agreement also contains a TBT (Technical Barriers to Trade) chapter covering technical regulations, standards and conformity assessment.
In simple terms, a lower tariff does not mean lower product standards.
What Indian exporters should prepare
Companies can start preparing before the agreement enters into force.
They should:
- Confirm the HS code for products exported to the EU.
- Check the tariff schedule and the date of the planned reduction.
- Review Rules of Origin, especially where imported inputs are used.
- Prepare origin records needed to support preferential tariff claims.
- Check EU regulatory requirements applicable to the product.
This will help businesses understand the actual benefit available to them rather than relying only on the overall 91% figure.
What happens next?
With legal scrubbing completed on 20 August 2026, the India–EU FTA has moved closer to signing.
The agreement is expected to be signed by the end of 2026, followed by the required legal and approval procedures before it enters into force.
For Indian exporters, the next important step will be to understand the product-specific tariff schedules once the agreement is ready for implementation.
The 91% figure is significant, but product details matter
The India–EU FTA could give Indian exporters wider access to the European market. The EU’s commitment to eliminate tariffs on more than 90% of tariff lines covering 91% of the value of its imports from India represents a substantial change in market access.
But the benefit will not be identical for every exporter.
The actual tariff advantage will depend on the product, the phase-out schedule and compliance with Rules of Origin. EU regulatory requirements will also continue to apply.
With negotiations concluded in January and legal scrubbing completed in August 2026, Indian exporters now have a clearer picture of what is coming. For Indian exporters, the important questions are which products will get lower tariffs, when those reductions will take effect and what conditions must be met to use them.
