European Union–India free trade agreement negotiations concluded on Tuesday, solidifying an eradication of duties on up to 99 percent of Indian goods being imported into Europe.
The development gives India a boost in an area where other countries like Bangladesh, Turkey and Pakistan have thus far had an advantage. The textile ministry noted that this would reduce tariffs by up to 12 percent for textiles and apparel.Prime Minister Narendra Modi announced the the deal, which has been two decades in the making, bringing hope to an industry that has been reeling from the impact of the United States’ 50 percent tariffs announced by President Donald Trump last year.
Business heads across the country said they had been waiting anxiously for the FTA with the EU to help offset some of this pain.
“We knew it was coming,” K. Subraminiam, a small apparel manufacturer in Chennai, told Sourcing Journal, “but it was so important that we were almost afraid to envision any last minute glitches.”
He described the deal as a “winning move,” with European Commission President Ursula von der Leyen and European Council President António Costa attending as the chief guests for India’s remarkable Republic Day celebrations held in New Delhi on Monday.
“There are moments when history itself declares that this is where the direction changed, that this is where a new era began. Today’s historic Summit between India and the European Union represents such a moment,” Modi said while announcing the conclusion of the negotiations.
“Today, India has concluded the largest Free Trade Agreement. It is a happy coincidence that on the 27th day of the month, India is entering into this FTA with the 27 Member States of the European Union,” he said during the joint press statement with Costa and von der Leyen.
There have been big words of praise for this historic agreement from all sides, with von der Leyen labeling it the”mother of all deals.”
“This is the tale of two giants; the world’s second and fourth largest economies. Two giants which chose partnership in a true win-win fashion. A strong message that cooperation is the best answer to global challenges,” she observed. The FTA sealed by India and the EU sends “a strong signal to the world,” she added, describing it as a “decisive moment” in India-EU partnership.