India and the European Union Concluded Their Free Trade Agreement on 27 January 2026, and the Commission Sent It to the Council for Signature on 11 September

India and the European Union announced on 27 January 2026 that they had concluded negotiations on a free trade agreement, at the 16th India-EU Summit, held during the European leaders’ visit to India. The European Commission calls it the largest trade agreement either side has ever concluded. India’s Commerce Ministry says it gives more than 99 per cent of Indian exports, by value, preferential entry to the EU market. “Concluded” is the precise word, because the text has not been signed. The Commission sent its proposals for signature and conclusion to the Council of the EU on 11 September 2026.

The Commission dates the talks to 2007, records that they were suspended in 2013 and relaunched in 2022, and says the 14th and final formal round took place in October 2025.

How much trade the agreement covers

India’s goods trade with the EU was US$136.54 billion (Rs 11.5 lakh crore) in 2024-25, according to the Commerce Ministry. Of that, India’s exports were US$75.85 billion and imports US$60.68 billion. India’s exports to the EU grew from US$41.36 billion in 2020-21, which the ministry puts at 16.4 per cent a year on a compound basis. Imports from the EU grew from US$39.72 billion at 11.2 per cent a year. Services trade reached US$83.10 billion (Rs 7.2 lakh crore) in 2024.

The Commission’s own total is more than 180 billion euros a year in goods and services, a figure it says supports close to 800,000 EU jobs. The two sides quote different currencies and years, so the figures do not add up neatly. Both call the parties the world’s fourth largest economy (India) and second largest (the EU), and say together they hold about a quarter of world GDP. How India’s rank is measured is set out in tuput’s piece on India’s GDP rank.

What India gets in the EU market

India’s tables give the EU’s concessions as 97 per cent of tariff lines, covering 99.5 per cent of trade value. Duty on 70.4 per cent of lines, covering 90.7 per cent of India’s exports, is removed immediately. Another 20.3 per cent of lines, covering 2.9 per cent of exports, reach zero duty over three or five years. A further 6.1 per cent of lines, covering 6 per cent of exports, get lower tariffs or quotas, with cars, steel and certain shrimp products among the quota lines.

The weight falls on goods that employ many people. The ministry says labour-intensive sectors with more than US$33 billion of exports, now facing EU duties of 4 to 26 per cent, enter at zero from the day the agreement takes effect. Its FAQ table lists leather and footwear, textiles, apparel, toys and sports goods as 100 per cent duty-free at entry into force. Apparel alone was US$5.71 billion of calendar-year 2024 exports, with EU duty of up to 12 per cent.

The EU kept some products out. The Commission names beef, chicken meat, rice and sugar. India’s FAQ lists meat and meat offal, dairy, honey, rice, sugar and tobacco.

What India offers in return

India’s offer is 92.1 per cent of its tariff lines, covering 97.5 per cent of EU exports by value. Duty on 49.6 per cent of lines, which is 30.6 per cent of trade value, goes immediately. Another 39.5 per cent of lines, 63.1 per cent of value, are phased out over 5, 7 or 10 years. Apples, pears, peaches and kiwi fruit come in under quotas.

The Commission’s questions and answers give examples. Tariffs on cars fall from 110 per cent to 10 per cent, with a quota of 250,000 vehicles a year. Duties of up to 44 per cent on machinery and 22 per cent on chemicals are mostly eliminated. Wine at 150 per cent falls to 75 per cent when the agreement takes effect and eventually to levels as low as 20 per cent. The law firm Cyril Amarchand Mangaldas reports a car import quota of 100,000 units in the first year rising to 160,000 by the tenth, for internal-combustion and hybrid cars, which differs from the Commission’s 250,000. The published schedules will settle that. India’s electric vehicle numbers are a separate subject, covered in India’s EV figures.

India’s highest import duty was 355 per cent in 1990-91 and 25 per cent by 2003-04, as tuput’s account of the 1991 reforms records. Cars, wine and spirits are among the lines where the pre-agreement rates, as the two sides publish them, sit far above that 25 per cent.

India’s release says sensitive farm products and dairy get no market access. The ministry lists dairy, cereals, poultry and soymeal as protected. The agreement also gives India a bilateral safeguard. If imports from the EU surge and seriously injure a domestic industry, India can apply a measure for two years, extendable by two more, and no longer than four.

Services and the movement of professionals

The EU has made commitments across 144 services sectors and subsectors, including IT and IT-enabled services, professional services, education and other business services. India has offered 102, including maritime transport, financial services, telecommunications and environmental services.

The mobility chapter sets stay limits. Business visitors may stay 90 days in any six months. Managers and specialists transferred inside a company get three years, extendable by two. Contractual service suppliers and independent professionals get a cumulative 12 months. The EU has listed 37 sectors for contractual suppliers and 17 for independent professionals, and gives dependents of transferred staff entry and work rights.

India and the EU also agreed a framework to work toward social security agreements with member states over five years. Indian traditional medicine practitioners may work under their home qualifications in EU states that do not regulate the field.

On the Indian side, the FAQ records commitments of 100 per cent foreign investment in insurance and 74 per cent in banking, and market access for 15 EU bank branches over four years. The Commission calls India’s financial services commitments the most ambitious in any trade agreement it has made.

Where the two sides count differently

The headline coverage figures are not one number. The Commission’s January release says tariffs on 96.6 per cent of EU goods exports to India, by value, are eliminated or reduced. Its September release says 96 per cent. Its questions and answers say over 90 per cent, and its topic page says 90 per cent. India counts 92.1 per cent of tariff lines and 97.5 per cent of value. Lines and value are different measures, as are “eliminated” and “eliminated or reduced”. The Commission pages do not reconcile their own variants.

The carbon border adjustment mechanism, or CBAM, is the EU’s carbon charge on certain imports, steel among them. India’s ministry says the agreement secured a most-favoured-nation assurance, meaning any flexibility the EU grants a third country under the regulation would be extended, plus cooperation on recognising carbon prices and verifiers. Argus Media reported the Commission’s chief spokesperson saying on 27 January that “there is no commitment on the part of the EU to change our obligations.” The Commission says it envisages 500 million euros over two years to help India cut emissions, subject to EU budget rules.

Suvajit Banerjee and Tommaso Morotti wrote for Ideas for India on 17 August 2026 that tariff cuts could be eroded without convergence on how carbon costs are recognised. They warn of a “double compliance burden” and note that micro, small and medium enterprises make up around 40 per cent of Indian steel production.

What still has to happen

The Commission lists the steps. The Council adopts the decision to sign, the agreement is signed, the European Parliament consents, and the Council decides on conclusion. The agreement then enters into force once India also ratifies it. The Commission’s 11 September release says Indian authorities are going through their own internal ratification procedures in parallel.

The Commission asked for a fast-track route. The European Parliament’s tracking page, updated 20 September 2026, says that would complete the legal process on the English text only, and that some member states have reservations. It gives the target as signing in Brussels in December 2026. Cyril Amarchand Mangaldas, writing on 29 September, expects entry into force in early 2027. India’s External Affairs Minister said on 13 October 2026 that the hope was for entry into force by the end of this year or early next. Tuput found no report of a Council decision in the sources it checked on 14 October 2026.

Two related agreements are still being negotiated separately, one on geographical indications (protecting names of regional products) and one on investment protection. The text will be published in English, Hindi and the EU’s official languages, with English prevailing if they diverge. A general review by the Joint Committee is due within five years of entry into force and every five years after.