EU seeks lower tariffs on whiskey, wine, and cars in India trade deal talks: Report

A key concern for India is its textile exports, which currently face an additional 10 percent duty compared to competitors like Bangladesh and Vietnam, due to the absence of an FTA.

The European Union (EU) is reportedly pushing for lower tariffs on key exports such as whiskey, wine, and cars as part of ongoing negotiations for a Free Trade Agreement (FTA) with India. The demand will be a key discussion point during the upcoming visit of the EU’s College of Commissioners, led by European Commission President Ursula von der Leyen, to India on February 27-28, reported the Indian Express.

According to an EU official, cited in the Indian Express report, while negotiations have progressed, India’s relatively closed market on key commercial products remains an obstacle.

The EU is aiming for a comprehensive and commercially meaningful trade pact, covering tariffs, non-tariff barriers, and procurement commitments. The demand for lower tariffs follows nine rounds of FTA talks, with the tenth round scheduled for March 10-14 in Brussels, further states the report. If concluded, the EU-India FTA will be India’s largest such agreement, enhancing market access for labour-intensive sectors like textiles, leather, and marine products to the EU, India’s second-largest export market after the US, stated the report.

India is advocating for concessions for its MSMEs, particularly in light of the EU’s Carbon Border Adjustment Mechanism (CBAM), which could result in higher duties on Indian steel and aluminium products. India is also seeking greater integration with the EU’s services sector and increased skilled labour mobility opportunities, as per the report.

A key concern for India is its textile exports, which currently face an additional 10 percent duty compared to competitors like Bangladesh and Vietnam, due to the absence of an FTA. A deal with the EU would level the playing field for Indian textile exports.

Both sides had agreed in May 2021 to revive negotiations for a "balanced, ambitious, and comprehensive" trade deal after talks were abandoned nearly a decade ago. Separate negotiations are also underway for an investment protection agreement and a geographical indications (GI) agreement.