India-EU FTA Talks Continue: Steel, Auto and Carbon Tax-linked Trade Issues Under Negotiation
Both sides remain optimistic that the FTA will bolster macroeconomic growth and bilateral trade
India-EU FTA
India-EU FTA
India’s Union Minister of Commerce and Industry Piyush Goyal recently met with the European Commissioner for Trade and Economic Security, Maroš Šefčovič, furthering deliberations in the ongoing India-European Union Free Trade Agreement (FTA) negotiations.
Bridging differences on sensitive areas such as steel, automobiles, and the European Union’s carbon levy mechanism remained some of the key areas of discussion in the meeting with both sides reaffirmed their resolve to conclude the pact by the end of 2025.
As per an official release on the Press Information Bureau, the meetings were “productive and meaningful,” and reflected the strong political trust between the two partners. Both sides agreed that while progress had been made on several non-sensitive industrial tariff lines, further dialogue was needed on the more complex issues such as the Carbon Border Adjustment Mechanism (CBAM), or carbon tax and other EU regulatory measures.
Master the complexities of DTAA & International Taxation with expert-led live sessions — enhance your global tax skills today Click Here
In terms of India’s position in the FTA, primary concerns were centred around preferential treatment for labour-intensive sectors such as textiles and leather, while concerns were raised regarding non-tariff measures and new EU sustainability-related regulations.
Comprehensive Guide of Law and Procedure for Filing of Income Tax Appeals, Click Here
Following the visit, Minister Goyal posted on X that the talks had “significantly reduced our outstanding issues and allowed us to create the framework that will help deliver a win-win for our economies.”
Earlier this year, during the College of Commissioners’ visit to New Delhi, Prime Minister Narendra Modi and European Commission President Ursula von der Leyen had agreed to conclude the FTA by 2025. The ongoing talks aim to establish transparent and predictable regulatory frameworks that can accelerate trade and investment for both entities.
India’s trade with the EU stood at USD 136.5 billion in 2024-25, with the Union being India’s largest trading partner for goods.
A technical delegation from the EU’s Directorate General for Trade is expected to visit India next week to work on potential solutions identified during the Brussels meetings. Both sides are optimistic that the sustained engagement will lead to a balanced and mutually beneficial agreement that would strengthen the strategic economic partnership between India and the European Union.
Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
