India-EU FTA highlights: 'Mother-of-all deals' eliminates aircraft tariffs, cuts duties on alcohol, food & chemicals

India and the European Union have successfully concluded the Free Trade Agreement after an eighteen-year hiatus, where the two countries have agreed on wide-ranging tariff cuts and eliminations under, a move the EU says will sharply boost exports to the Indian market and deepen economic ties under a turbulent global trade order.

According to the European Union, the agreement will remove or reduce duties on over 90% of EU goods exported to India. The deal is expected to double EU exports to India by 2032 and also includes climate support funding to back India’s emissions-cutting efforts.

Also Read: India-EU FTA- The world’s biggest economies just changed global trade forever


EU exports to India already support around 800,000 European jobs, and the deal is expected to create many more.

The pact also includes €500 million in EU support over the next two years to help India cut greenhouse gas emissions and accelerate the green transition.

The pact covers major sectors such as alcohol, food products, chemicals, machinery, pharmaceuticals and aerospace.

Also Read: India-EU FTA- New Delhi cuts car tariffs from 110% to 10% for European Union

Key announcements from the EU

• EU exporters to save up to €4 billion a year in duties
• Biggest trade opening India has ever given to any partner
• Simplified customs procedures to make exports faster and cheaper
• Beer tariffs to be cut to 50%
• Spirits tariffs to be cut to 40%
• Wine tariffs to be reduced to 20–30%
• Motor vehicle tariffs will be slashed from 110% to 10% under a quota of 250,000 vehicles a year
• The EU and India are currently negotiating a separate agreement on Geographical Indications (GIs)
• Tariffs on olive oil, margarine and vegetable oils to be eliminated
• Tariffs on fruit juices and processed food to be eliminated
• Tariffs on almost all EU chemical products to be eliminated
• Duties of up to 44% on machinery to be mostly eliminated
• Duties of up to 22% on chemicals to be mostly eliminated
• Duties of up to 11% on pharmaceuticals to be mostly eliminated
• Tariffs on aircraft and spacecraft to be eliminated for almost all products
• Over 90% of EU goods exports to India will see tariffs eliminated or reduced
• €500 million in EU support over the next two years envisaged to help India cut greenhouse gas emissions
• Strong protection for EU trademarks, designs, copyrights and trade secrets
• Digital trade chapter to ensure secure, fair and predictable online commerce
• Privileged access for EU service providers in financial and maritime services
• Enhanced access expected to open new business and job opportunities
• Dedicated SME chapter
• SME contact points to help firms trade and invest more easily
• More transparency, fewer regulatory barriers

Product	2024 exports (EUR)	Current tariffs	Future Tariffs
Machinery and electrical equipment	€16.3 billion	Up to 44%	0% for almost all products
Aircraft and spacecraft	€6.4 billion	Up to 11%	0% for almost all products
Optical, medical and surgical equipment	€3.4 billion	Up to 27,5%	0% for 90% of the products
Plastics	€2.2 billion	Up to 16,5%	0% for almost all products
Pearls, precious stones and metals	€2.1 billion	Up to 22,5%	0% for 20% of the products and tariff reduction for another 36% of the products
Chemicals	€3.2 billion	Up to 22%	0% for almost all products
Motor vehicles	€1.6 billion	110%	10% (quota of 250k)
Iron and steel	€1.5 billon	Up to 22%	0% for almost all products
Pharmaceuticals	€1.1 billion	11%	0% for almost all products

EU agri-food sectors that will benefit:

Product	Current tariffs	Future Tariffs
Wine	150%	20% (premium range); 30% (medium range)
Spirits	Up to 150%	40%
Beer	110%	50%
Olive Oil, margarine and other vegetable oils	Up to 45%	0%
Kiwis and pears	33%	10% in-quota
Fruit juices and non-alcoholic beer	Up to 55%	0%
Processed food (breads, pastries, biscuits, pasta, chocolate, pet food)	Up to 50%	0%
Sheep meat	33%	0%
Sausages and other meat preparations	Up to 110%	50%