India-EU Trade Deal: Cars, Wine, Olive Oil, Processed Foods, Fruits & More - What Gets Cheaper; Complete List

European products, ranging from luxury cars to fine wines and advanced medical equipment, are expected to become more affordable in India following a landmark trade agreement between India and the European Union. The deal, hailed by Prime Minister (PM) Narendra Modi as the "biggest trade deal ever" and referred to by negotiators as the "mother of all deals".

Under the new India-EU trade deal, a wide range of products are set to become more affordable in India, benefiting both consumers and industries. For consumers, the agreement is expected to lower prices on European cars, premium and mid-range wines, spirits, beer, olive oil, processed foods, fruits such as kiwi and pears, and meat products including sheep meat and sausages.

For industries, significant cost reductions will be seen on imports of machinery, electrical equipment, medical devices, pharmaceuticals, chemicals, plastics, iron and steel, and aerospace components, helping manufacturers, healthcare providers and infrastructure sectors reduce production costs and improve efficiency.

India-EU Trade Deal to Make Cars, Wine, Olive Oil, Processed Foods & More Products Cheaper; Check Complete List of Items

Automobiles

• European cars (within quota of 2,50,000 vehicles per year): Import duty falls from 110% to 10%
• Premium and luxury vehicles

Alcohol & Beverages

• Premium European wine: reduction from 150% to 20%
• Mid-range European wine: reduction from 150% to 30%
• Spirits (whisky, liquor): reduction from up to 150% to 40%
• Beer: reduction from 110% to 50%
• Fruit juices and non-alcoholic beer: reduction from up to to 55%0%

Oils & Food Products

• Olive oil and other European vegetable oils will see reduction from 45% to 0%
• Processed foods (biscuits, bread, pasta, chocolate, pastries, pet food): duty cut from up to 50% to 0%
• Sheep meat: duty cut from 33% to 0%
• Sausages and processed meats: duty cut from up to 110% to 50%
• Kiwi and pears: duty falls from 33% to 10% (within quota limits)

Industrial machinery: duty reduction from up to 44% to 0% (almost all items)

Electrical equipment: duty cut from up to 44% to 0%

Power systems, factory equipment, advanced electrical components' duty falls to 0%

Medical & Healthcare Devices

Medical devices, surgical instruments, diagnostic machines, lenses: duty cut from up to 27.5% to 0% (covers 90% of items)

Pharmaceuticals

• Almost all European pharma products: duty cut from ~11% to 0%
• Includes specialised medicines and ingredients for advanced therapies

Chemicals & Industrial Inputs

• Plastics: duty cut from up to 16.5% to 0%
• Chemicals: duty down from up to 22% to 0%
• Iron and steel: duty mostly removed from up to 22%

Aviation & Aerospace

Aircraft and spacecraft components: duty cut from up to 11% to 0%. It will be beneficial for airlines, defence manufacturers, and maintenance providers

EU Imports of Indian Goods (reciprocal reduction for exporters)

• Marine products
• Leather and textiles
• Chemicals, rubber, base metals
• Gems and jewellery

India-EU FTA: Key Provisions and Highlights of the Agreement

The India-EU trade pact effectively creates a free trade zone covering nearly two billion people. European Commission President Ursula von der Leyen described it as "creating history by forming a free trade zone of nearly two billion people, with benefits for both economies." As part of the agreement, Europe has pledged €500 million toward India's carbon emission reduction projects.

One of the most notable changes is for European automobiles. Import duties on cars in India will drop sharply from 110% to 10% under an annual quota of 2,50,000 vehicles, benefiting the premium and luxury segments most prominently if companies pass on the cost savings to consumers.

"By reducing tariffs and streamlining regulatory barriers, Indian exporters in sectors such as pharmaceuticals, textiles, automotive components, and information technology services stand to gain improved access to one of the world's largest consumer markets," said Ross Maxwell, Global Strategy Operations Lead, VT Markets.

"The India-EU Free Trade Agreement is expected to positively influence India's export and import competitiveness over the medium term. With both sides opening their markets, Indian industries will gain access to a much larger European market, helping to boost exports in sectors such as automobiles, textiles, and chemicals. Reduced trade barriers will make Indian products more competitive and enable smoother trade flows between the two regions," said Swapnil Aggarwal, Director, VSRK Capital.

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