India-EU FTA highlights: ‘Mother of trade deals’ eliminates aircraft tariffs, cuts duties on alcohol, food & chemicals

India and the European Union, after a gap of eighteen years, successfully signed the Free Trade Agreement in which the two countries agreed on far-reaching tariff cuts and elimination of tariffs; The EU says the move will sharply increase exports to the Indian market and deepen economic ties under a turbulent global trading order.

According to the European Union, the deal will eliminate or reduce duties on more than 90% of EU goods exported to India. The deal is expected to double EU exports to India by 2032 and also includes climate support funding to support India’s emissions reduction efforts.

The agreement covers major sectors such as alcohol, food products, chemicals, machinery, pharmaceuticals and aviation.

Important announcements from the EU

• Beer tariffs will be reduced to 50 percent
• Alcoholic beverage tariffs will be reduced to 40 percent
• Wine tariffs will be reduced to 20-30%
• Tariffs on olive oil, margarine and vegetable oils will be abolished
• Tariffs on fruit juices and processed foods to be removed
• Tariffs on almost all EU chemical products will be removed
• Up to 44% taxes on machinery will be largely abolished
• Taxes of up to 22% on chemicals will be largely eliminated
• Taxes of up to 11 percent on medicines will be largely abolished
• Tariffs on aircraft and spacecraft will be eliminated on almost all products
• More than 90% of exports of EU goods to India will see tariffs removed or reduced
• EU support of €500 million is foreseen over the next two years to help India reduce greenhouse gas emissions