India-EU FTA deal: What is set to get cheaper and what could cost more

1. European Cars Could Become Cheaper in India | One of the biggest changes under the deal is in the automobile sector. India currently imposes import duties of over 100% on fully built foreign cars. Under the FTA, tariffs on European-made vehicles could be reduced to around 40% over time. This could make cars from brands such as BMW, Mercedes-Benz, Volkswagen and Renault more affordable for Indian buyers. However, the cuts are expected to be phased in, with safeguards in place to protect domestic players, such as Tata Motors, Mahindra, and Suzuki. (Image: Canva)

2. European Wine and Beer Prices May Fall | Alcoholic beverages are another major focus of the agreement. Import duties on European wine and beer are expected to decrease significantly, making these products more affordable in the Indian market. This could benefit consumers in metro cities, hotels and restaurants, where imported alcohol is currently expensive due to high taxes. (Image: Canva)

3. Processed European Food Products Could Cost Less | Several processed food items from Europe, including olive oil, fruit juices and packaged foods, are likely to see lower prices after tariff cuts. However, sensitive agricultural and dairy products have been kept out of the deal to protect Indian farmers, meaning staples such as milk and basic farm produce will not be affected. (Image: Canva)

4. Medical Equipment and Machinery May Get Cheaper | The FTA is expected to reduce duties on medical devices, optical and surgical equipment, machinery and industrial tools imported from the EU. This could help Indian hospitals, manufacturers and infrastructure projects by lowering input costs and improving access to advanced technology. (Image: Canva)

5. Indian Textiles and Garments Could Become More Competitive in Europe | On the export side, Indian industries stand to gain. The EU will ease market access for Indian textiles, garments, leather products and jewellery, helping them compete better with exporters from countries such as Bangladesh and Vietnam. Lower tariffs could boost exports and support jobs in labour-intensive sectors. (Image: Canva)

6. Pharmaceuticals, Chemicals and Electronics to Benefit | Indian exporters of pharmaceuticals, chemicals and electronics are also expected to benefit from easier access to the European market. This could help offset concerns over the EU reducing preferential access under its Generalised System of Preferences, which has already affected nearly $2 billion worth of Indian exports. (Image: Canva)

7. Some Products Will Remain Costly | Despite the wide scope of the deal, farm and dairy products have been excluded, reflecting India’s concern over protecting millions of small farmers. Certain sensitive industrial sectors have also been handled cautiously to prevent sudden disruption to domestic producers. Prices in these segments are unlikely to change much. (Image: Canva)

8. Carbon Taxes Could Raise Costs for Some Indian Exports | Non-tariff barriers remain a concern. India has raised objections to EU carbon-related levies on imports of steel, aluminium and cement. These measures could increase costs for Indian exporters, even as tariffs are lowered under the FTA. (Image: Canva)