German media: Negotiations completed! India and the EU are about to reach a free trade agreement

India's trade minister said on Monday that India and the EU have completed negotiations on an awaited trade agreement. Both sides called the agreement historically significant. Currently, both India and the EU have tense relations with the United States. The India-EU free trade agreement is expected to be finalized as early as Tuesday of this week.

India's Minister of Commerce, Rajesh Agrawal, stated on Monday that India and the EU have completed negotiations on the free trade agreement. He said, "This will be a balanced and forward-looking agreement aimed at better economic integration with the EU. The agreement will promote trade and investment between the two sides."

Last week, European Commission President von der Leyen said at the World Economic Forum in Davos that the EU is about to sign a historic trade agreement with India, which would create a market for 2 billion people. On January 25, von der Leyen arrived in India for a three-day visit and joined European Council President Costa as a guest of honor at the Republic Day celebrations held in New Delhi, India, on the 26th. On January 27, the two will attend the EU-India Summit and hold talks with Indian Prime Minister Modi. It is expected that the agreement will be approved on the same day.

Once the agreement is signed, India will be able to enjoy preferential access to the 27 EU member states, while European companies will also increase their exports to India.

The EU is India's largest trading partner. Nearly 6,000 European companies operate in India. Official data shows that in the fiscal year 2024-2025, the total value of goods traded between India and the EU was approximately USD 136 billion, with India's exports amounting to about USD 76 billion and imports about USD 60 billion.

India plans to significantly reduce tariffs on EU cars

The German industry has been eagerly awaiting the free trade agreement between the EU and India. In 2024, Sino-German trade amounted to around EUR 31 billion. Germany exported goods worth EUR 17 billion to India, with machinery accounting for about 26%. Meanwhile, India exported goods worth EUR 14 billion to Germany. Over the past decade, Sino-German trade has almost doubled. Currently, about 2,000 German companies have subsidiaries in India, employing over 500,000 workers.

Volker Treier, head of foreign trade at the German Chamber of Industry and Commerce (DIHK), said on Monday, "This agreement helps reduce the considerable tariffs and trade barriers that our companies sometimes face when entering the Indian market."

Significantly reduced tariffs on industrial products are especially beneficial for companies in the automotive, mechanical engineering, and chemical industries. According to sources, as part of the free trade agreement, India plans to significantly reduce tariffs on EU cars, from a maximum of 110% to 40%, with the tax reduction initially applying to a quota of about 200,000 fuel vehicles per year. India is the world's third-largest automobile market after the US and China.

The agreement is also expected to promote the export of Indian textiles and jewelry.

Currently, relations between India and the US, as well as between the EU and the US, are relatively tense. The India-EU free trade agreement will help both sides promote diversified supply chains and reduce geopolitical risks.

Sources: DW, Reuters, etc.

Original article: toutiao.com/article/1855469164740811/

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