India-EU Free Trade Deal to Be Concluded by January 27: Key Details

India and the European Union (EU) are set to conclude Free Trade Agreement (FTA) negotiations by January 27, paving the way for expanded market access for Indian exports, tariff adjustments, and enhanced mobility for skilled workers. The landmark deal, described by Commerce Minister Piyush Goyal as the “mother of all deals,” aims to strengthen bilateral trade and economic cooperation between India and the EU.

India and EU Set to Conclude Free Trade Agreement by January 27

India and the European Union (EU) are expected to announce the conclusion of Free Trade Agreement (FTA) negotiations by January 27, sources told CNBC-TV18, marking a major milestone in bilateral trade relations.

EU leaders are expected to meet Prime Minister Narendra Modi at the time of the announcement.

Indian Commerce Minister Piyush Goyal had earlier described this as the "mother of all deals" when indicating the same timeline for completing negotiations.

Following the announcement, both sides will finalise the legal text of the FTA, which will then require approval from the European Parliament and the EU Council, before being formally signed by the European Commission and India. Officials aim to complete signing and ratification by 2026.

Balanced Agreement Across Sensitive Sectors

Negotiators have struck a balance on sensitive areas such as agriculture and dairy, ensuring both sides’ red lines are respected. At the same time, the EU has agreed to provide greater market access for Indian labour-intensive exports, a key win for India’s export sector.

Automobile Trade Negotiations

Discussions are ongoing regarding automobile trade. EU car exports to India will fall under a tariff reduction quota, with rates phased by fuel type and vehicle segment. Exact quotas and tariff levels are still being finalized.

Improved Market Access for EU Wines and Spirits

EU wines and spirits, which face 200% tariffs from the US, are expected to gain improved access to the Indian market as part of the FTA deal, enhancing trade opportunities for European beverage companies.

Climate Policy and Carbon Adjustment

On climate policy, the EU will maintain its Carbon Border Adjustment Mechanism (CBAM), ensuring imported goods face the same carbon cost as EU products. However, the EU has committed to support Indian firms in decarbonisation efforts, easing compliance for exporters.

MoU on Skilled Worker Mobility

In addition to trade measures, India and the EU are expected to sign a Memorandum of Understanding (MoU) on mobility of professionals, facilitating easier movement for skilled workers between the regions.

Post-FTA, the EU plans a major outreach exercise to accelerate trade relations and strengthen ties in sectors ranging from IT and pharmaceuticals to textiles and engineering.

Key Takeaways

• India and the EU are set to conclude FTA negotiations by January 27

• Sensitive sectors like agriculture, dairy, and automobiles have been negotiated carefully

• Indian labour-intensive exports will see increased access to EU markets

• EU wines and spirits may benefit from reduced tariffs

• CBAM compliance support to Indian exporters

• MoU on skilled worker mobility to facilitate easier migration for professionals

• Ratification expected by 2026

This FTA is expected to strengthen India-EU economic ties, support India’s export growth, and provide a framework for sustainable trade practices.