{"id":65861,"date":"2026-01-27T09:26:37","date_gmt":"2026-01-27T12:26:37","guid":{"rendered":"https:\/\/automotive.einnews.com\/article\/886878329"},"modified":"2026-01-27T09:26:37","modified_gmt":"2026-01-27T12:26:37","slug":"european-carmakers-gain-major-access-as-india-eases-tariffs-under-eu-fta","status":"publish","type":"post","link":"https:\/\/new7.shop\/zerocostfreehost\/index.php\/2026\/01\/27\/european-carmakers-gain-major-access-as-india-eases-tariffs-under-eu-fta\/","title":{"rendered":"European carmakers gain major access as India eases tariffs under EU FTA"},"content":{"rendered":"
India EU Free Trade Agreement: European carmakers gain major access as India eases tariffs under EU FTA, ETAuto<\/title> <!– –> <!– –> <!-- Google Tag Manager --><br \/>\n<!-- analytics_gtm_id to be passed dynamically per portal--> <!-- End Google Tag Manager --> <\/p>\n<header> <!-- For Accessiblity only --> <!– <\/p>\n<div id=\"skiptocontent\" aria-label=\"skip content\"> <a href=\"#maincontent\" aria-label=\"skip main content link\">skip to main content<\/a> <\/div>\n<p> –> <!-- Ads block --> <\/p>\n<section aria-label=\"Top Ads Block\" class=\" top-ads\"> <\/section>\n<p> <!-- Content Header with navigation --> <!-- To be implemented mobile view --> <!-- Mobile Header --> <!-- mobile callout section --> <!-- Top Header InPage Promos --> <\/header>\n<p> <!-- Include layout structure template --> <\/p>\n<div class=\"main-content\"> <main id=\"maincontent\" class=\"layout2\"><\/p>\n<div id=\"news_items_container\">\n<section class=\"container-mid article-section status_prime_article single-post currentlyInViewport inViewPort \" id=\"news_dtl_127615186\" data-article=\"0\" data-href=\"https:\/\/auto.economictimes.indiatimes.com\/news\/industry\/european-carmakers-gain-major-access-as-india-eases-tariffs-under-eu-fta\/127615186\" data-msid=\"127615186\" data-mediaid data-authors=\"[\" data-author-list=\"ETAuto Desk\" data-category-name=\"Industry\" data-category_id=\"23\" data-cat_msid=\"25384693\" data-date=\"2026-01-27\" data-index=\"article_1\" data-keywords=\"India EU Free Trade Agreement, European automakers in India, Car import tariffs India, Electric vehicle market India, Volkswagen Group, Mercedes-Benz Group, Mahindra & Mahindra\" data-type=\"news\">\n<div class=\"article-section__body \">\n<div class>\n<div class=\"article-section__body--top\">\n<div class=\"article-section__body__authors\">\n<div class=\"news-author-container\">\n<div class=\"author-image\"> <img data-opt-id=758893364 fetchpriority=\"high\" decoding=\"async\" src=\"data:image\/gif;base64,R0lGODlhAQABAIAAAAAAAP\/\/\/ywAAAAAAQABAAACAUwAOw==\" fifu-lazy=\"1\" fifu-data-sizes=\"auto\" fifu-data-srcset=\"https:\/\/auto.economictimes.indiatimes.com\/Themes\/Release\/theme4\/images\/icons\/et-default-user.svg?w=75&resize=75&ssl=1 75w, https:\/\/auto.economictimes.indiatimes.com\/Themes\/Release\/theme4\/images\/icons\/et-default-user.svg?w=100&resize=100&ssl=1 100w, https:\/\/auto.economictimes.indiatimes.com\/Themes\/Release\/theme4\/images\/icons\/et-default-user.svg?w=150&resize=150&ssl=1 150w, https:\/\/auto.economictimes.indiatimes.com\/Themes\/Release\/theme4\/images\/icons\/et-default-user.svg?w=240&resize=240&ssl=1 240w, https:\/\/auto.economictimes.indiatimes.com\/Themes\/Release\/theme4\/images\/icons\/et-default-user.svg?w=320&resize=320&ssl=1 320w, https:\/\/auto.economictimes.indiatimes.com\/Themes\/Release\/theme4\/images\/icons\/et-default-user.svg?w=500&resize=500&ssl=1 500w, https:\/\/auto.economictimes.indiatimes.com\/Themes\/Release\/theme4\/images\/icons\/et-default-user.svg?w=640&resize=640&ssl=1 640w, https:\/\/auto.economictimes.indiatimes.com\/Themes\/Release\/theme4\/images\/icons\/et-default-user.svg?w=800&resize=800&ssl=1 800w, https:\/\/auto.economictimes.indiatimes.com\/Themes\/Release\/theme4\/images\/icons\/et-default-user.svg?w=1024&resize=1024&ssl=1 1024w, https:\/\/auto.economictimes.indiatimes.com\/Themes\/Release\/theme4\/images\/icons\/et-default-user.svg?w=1280&resize=1280&ssl=1 1280w, https:\/\/auto.economictimes.indiatimes.com\/Themes\/Release\/theme4\/images\/icons\/et-default-user.svg?w=1600&resize=1600&ssl=1 1600w\" loading=\"eager\" width=\"40\" height=\"40\" class=\"unveil check-user-initials user-init-cat\" fifu-data-src=\"https:\/\/auto.economictimes.indiatimes.com\/Themes\/Release\/theme4\/images\/icons\/et-default-user.svg\" data-src alt=\"ETAuto Desk\"> <\/div>\n<div class=\"author-section\">\n<ul>\n<li>Updated On Jan 27, 2026 at 08:57 PM IST<\/li>\n<\/ul><\/div>\n<\/p><\/div>\n<\/p><\/div>\n<\/p><\/div>\n<div class=\"article-section__body__news\"> <!-- Display video article in news article for the custom next story --> <!-- Modifying the body placing embeds,promoslots,related etc.--> <b> <\/p>\n<figure class=\"img_container\"><img data-opt-id=758893364 fetchpriority=\"high\" decoding=\"async\" src=\"data:image\/gif;base64,R0lGODlhAQABAIAAAAAAAP\/\/\/ywAAAAAAQABAAACAUwAOw==\" fifu-lazy=\"1\" fifu-data-sizes=\"auto\" fifu-data-srcset=\"https:\/\/mlmjbqro95r8.i.optimole.com\/cb:bOxR.6a5\/w:auto\/h:auto\/q:mauto\/f:best\/https:\/\/i1.wp.com\/auto.economictimes.indiatimes.com\/images\/default.jpg?ssl=1&w=75&resize=75&ssl=1 75w, https:\/\/mlmjbqro95r8.i.optimole.com\/cb:bOxR.6a5\/w:auto\/h:auto\/q:mauto\/f:best\/https:\/\/i1.wp.com\/auto.economictimes.indiatimes.com\/images\/default.jpg?ssl=1&w=100&resize=100&ssl=1 100w, https:\/\/mlmjbqro95r8.i.optimole.com\/cb:bOxR.6a5\/w:auto\/h:auto\/q:mauto\/f:best\/https:\/\/i1.wp.com\/auto.economictimes.indiatimes.com\/images\/default.jpg?ssl=1&w=150&resize=150&ssl=1 150w, https:\/\/mlmjbqro95r8.i.optimole.com\/cb:bOxR.6a5\/w:auto\/h:auto\/q:mauto\/f:best\/https:\/\/i1.wp.com\/auto.economictimes.indiatimes.com\/images\/default.jpg?ssl=1&w=240&resize=240&ssl=1 240w, https:\/\/mlmjbqro95r8.i.optimole.com\/cb:bOxR.6a5\/w:auto\/h:auto\/q:mauto\/f:best\/https:\/\/i1.wp.com\/auto.economictimes.indiatimes.com\/images\/default.jpg?ssl=1&w=320&resize=320&ssl=1 320w, https:\/\/mlmjbqro95r8.i.optimole.com\/cb:bOxR.6a5\/w:auto\/h:auto\/q:mauto\/f:best\/https:\/\/i1.wp.com\/auto.economictimes.indiatimes.com\/images\/default.jpg?ssl=1&w=500&resize=500&ssl=1 500w, https:\/\/mlmjbqro95r8.i.optimole.com\/cb:bOxR.6a5\/w:auto\/h:auto\/q:mauto\/f:best\/https:\/\/i1.wp.com\/auto.economictimes.indiatimes.com\/images\/default.jpg?ssl=1&w=640&resize=640&ssl=1 640w, https:\/\/mlmjbqro95r8.i.optimole.com\/cb:bOxR.6a5\/w:auto\/h:auto\/q:mauto\/f:best\/https:\/\/i1.wp.com\/auto.economictimes.indiatimes.com\/images\/default.jpg?ssl=1&w=800&resize=800&ssl=1 800w, https:\/\/mlmjbqro95r8.i.optimole.com\/cb:bOxR.6a5\/w:auto\/h:auto\/q:mauto\/f:best\/https:\/\/i1.wp.com\/auto.economictimes.indiatimes.com\/images\/default.jpg?ssl=1&w=1024&resize=1024&ssl=1 1024w, https:\/\/mlmjbqro95r8.i.optimole.com\/cb:bOxR.6a5\/w:auto\/h:auto\/q:mauto\/f:best\/https:\/\/i1.wp.com\/auto.economictimes.indiatimes.com\/images\/default.jpg?ssl=1&w=1280&resize=1280&ssl=1 1280w, https:\/\/mlmjbqro95r8.i.optimole.com\/cb:bOxR.6a5\/w:auto\/h:auto\/q:mauto\/f:best\/https:\/\/i1.wp.com\/auto.economictimes.indiatimes.com\/images\/default.jpg?ssl=1&w=1600&resize=1600&ssl=1 1600w\" width=\"590\" height=\"442\" class=\"unveil\" loading=\"eager\" fifu-data-src=\"https:\/\/mlmjbqro95r8.i.optimole.com\/cb:bOxR.6a5\/w:auto\/h:auto\/q:mauto\/f:best\/https:\/\/i1.wp.com\/auto.economictimes.indiatimes.com\/images\/default.jpg?ssl=1\" data-src=\"https:\/\/etimg.etb2bimg.com\/photo\/127618784.cms\" alt><\/figure>\n<p>New Delhi:<\/b> India has agreed to grant European automakers an import quota more than six times larger than any it has offered in recent trade deals, significantly lowering tariffs on cars under the India\u2013EU free trade agreement and opening up its tightly protected passenger vehicle market.<\/p>\n<p>According to Bloomberg, under the pact, India will gradually allow up to 250,000 European-made vehicles to enter the country at preferential duty rates, according to people familiar with the negotiations. This compares with a quota of about 37,000 units extended to the UK under a separate trade agreement, underscoring the scale of concessions made to the European Union.<\/p>\n<p>The move is expected to benefit major European carmakers, including <a id=\"31377162\" class=\"news-keywords\" href=\"https:\/\/auto.economictimes.indiatimes.com\/tag\/volkswagen+group\">Volkswagen Group<\/a>, <a id=\"32513510\" class=\"news-keywords\" href=\"https:\/\/auto.economictimes.indiatimes.com\/tag\/mercedes-benz+group\">Mercedes-Benz Group<\/a>, Stellantis and Renault, which have long sought improved access to India\u2019s fast-growing auto market.<\/p>\n<p>\u201cWe see a huge positive for the auto sector as it provides duty-free access to European markets and will attract European OEMs to invest further in India. This agreement is very well designed, as it lowers in-quota duties only at higher priced segments which will enhance scale in the core segments relevant to Make in India for the world. We feel this will not change any competitive dynamics in the industry,\u201d said Dr Anish Shah, Group CEO and MD, Mahindra Group.<\/p>\n<p><b>Tariff cuts phased in over time<\/b><\/p>\n<p>Of the total quota, around 160,000 internal combustion engine (ICE) vehicles will see import duties fall to 10 per cent within five years, while 90,000 electric vehicles will be eligible for the same tariff only by the 10th year of the agreement, a measure aimed at protecting India\u2019s nascent EV ecosystem.<\/p>\n<p>Initial in-quota tariffs will start at about 30 per cent for most segments. Beyond the quota, India has agreed to cut duties on fossil-fuel-powered cars to 35 per cent over 10 years, a sharp reduction from current levels that can reach 110 per cent.<\/p>\n<p><!-- PROMOSLOT_M --><b>Reciprocal access for Indian automakers<\/b><\/p>\n<p>In return, the EU will offer Indian automakers\u2014including <a id=\"30857522\" class=\"news-keywords\" href=\"https:\/\/auto.economictimes.indiatimes.com\/tag\/mahindra+%26+mahindra\">Mahindra & Mahindra<\/a>, Tata Motors Passenger Vehicles and Maruti Suzuki India\u2014import concessions covering up to 625,000 vehicles, a figure calibrated to reflect the relative sizes of the two markets.<\/p>\n<p>Tariffs on India-made electric vehicles imported into the EU within agreed quotas will be eliminated over 10 years. Smaller and lower-cost EVs will be phased in more gradually over 14 years, starting with 27,500 units in year five and rising to 125,000 units, equivalent to around 2 per cent of the EU market based on current estimates.<\/p>\n<p><!-- PROMOSLOT_M -->\u201cFor us, this is very positive news, as Renault Group has made long-term, high-value commitments to both regions. In many ways, Renault Group truly embodies the spirit of this partnership\u2014we are both an Indian and a European company, deeply rooted in and committed to the growth of both ecosystems,\u201d said St\u00e9phane Deblaise, CEO, Renault Group India<\/p>\n<p><!-- PROMOSLOT_M --><!-- PROMOSLOT --><b>CKD route and parts duty relief<\/b><\/p>\n<p>The pact also allows European manufacturers to export up to 75,000 cars a year priced above \u20ac15,000 for assembly in India using completely knocked-down (CKD) kits. Tariffs on these imports will be reduced to 8.25 per cent from 16.5 per cent.<\/p>\n<p>In addition, duties on auto components will be reduced to zero, supporting deeper supply-chain integration between India and Europe. Europe remains a key export destination for Indian auto component makers, while higher pricing of EU-made parts is expected to limit disruption to domestic manufacturing.<\/p>\n<p><b>Review clause and strategic trade reset<\/b><\/p>\n<p><!-- PROMOSLOT -->The agreement includes a review clause that allows import quotas to be reassessed periodically, reflecting growth in India\u2019s auto market and any concessions offered to future trade partners, including the US. These reviews will be linked to steel, a sector of strategic importance to India, providing leverage for both sides in future negotiations.<\/p>\n<p>While the pact stops short of fully liberalising the car market, analysts said it represents a major reset in India\u2013EU trade relations. For Europe, it offers long-sought access to a high-growth market. For India, it provides reciprocal access to the EU while supporting its broader goals of boosting exports, strengthening manufacturing, and integrating more deeply into global automotive supply chains.<\/p>\n<p>Piyush Arora, MD & CEO of Skoda Auto Volkswagen India (SAVW), said, \u201cWe believe this agreement will benefit customers in both regions. Greater tariff certainty and a more predictable trade framework will allow us to evaluate the introduction of a wider range of European models for Indian customers. Over time, this can support deeper technology transfer, capability building, and long-term investment in the Indian automotive ecosystem. \u201d<\/p>\n<p>However, the real impact will depend on the pace of tariff reductions and whether demand in India\u2019s premium and electric vehicle segments grows as anticipated over the coming years.<\/p>\n<p> <!-- Category Most Read Placement --> <\/p>\n<div class=\"bottom-author-detail-tag\">\n<div class=\"bottom-author-detail\">\n<ul class=\"article-publish-date\"> <!– <\/p>\n<li> Updated On Jan 27, 2026 at 08:57 PM IST<\/li>\n<p> –> <\/p>\n<li>Published On Jan 27, 2026 at 04:34 PM IST<\/li>\n<p> <!– <\/p>\n<li class=\"desktop-view\">4 min read<\/li>\n<p> –> <\/ul>\n<\/p><\/div>\n<\/p><\/div>\n<p> <!-- Comment Section --> <!-- Comment Section --> <\/p>\n<div class=\"subscription-in-article\">\n<div aria-label=\"Top Newsletter Subscription Section\" class=\"top-newsletter-subs\">\n<div class=\"subscription-section hide\">\n<div 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fifu-data-srcset=\"https:\/\/mlmjbqro95r8.i.optimole.com\/cb:bOxR.6a5\/w:auto\/h:auto\/q:mauto\/f:best\/https:\/\/i1.wp.com\/st.etb2bimg.com\/Themes\/Release\/theme4\/images\/bar-codes\/auto_barcode.png?mod=3118&ssl=1&w=75&resize=75&ssl=1 75w, https:\/\/mlmjbqro95r8.i.optimole.com\/cb:bOxR.6a5\/w:auto\/h:auto\/q:mauto\/f:best\/https:\/\/i1.wp.com\/st.etb2bimg.com\/Themes\/Release\/theme4\/images\/bar-codes\/auto_barcode.png?mod=3118&ssl=1&w=100&resize=100&ssl=1 100w, https:\/\/mlmjbqro95r8.i.optimole.com\/cb:bOxR.6a5\/w:auto\/h:auto\/q:mauto\/f:best\/https:\/\/i1.wp.com\/st.etb2bimg.com\/Themes\/Release\/theme4\/images\/bar-codes\/auto_barcode.png?mod=3118&ssl=1&w=150&resize=150&ssl=1 150w, https:\/\/mlmjbqro95r8.i.optimole.com\/cb:bOxR.6a5\/w:auto\/h:auto\/q:mauto\/f:best\/https:\/\/i1.wp.com\/st.etb2bimg.com\/Themes\/Release\/theme4\/images\/bar-codes\/auto_barcode.png?mod=3118&ssl=1&w=240&resize=240&ssl=1 240w, https:\/\/mlmjbqro95r8.i.optimole.com\/cb:bOxR.6a5\/w:auto\/h:auto\/q:mauto\/f:best\/https:\/\/i1.wp.com\/st.etb2bimg.com\/Themes\/Release\/theme4\/images\/bar-codes\/auto_barcode.png?mod=3118&ssl=1&w=320&resize=320&ssl=1 320w, https:\/\/mlmjbqro95r8.i.optimole.com\/cb:bOxR.6a5\/w:auto\/h:auto\/q:mauto\/f:best\/https:\/\/i1.wp.com\/st.etb2bimg.com\/Themes\/Release\/theme4\/images\/bar-codes\/auto_barcode.png?mod=3118&ssl=1&w=500&resize=500&ssl=1 500w, https:\/\/mlmjbqro95r8.i.optimole.com\/cb:bOxR.6a5\/w:auto\/h:auto\/q:mauto\/f:best\/https:\/\/i1.wp.com\/st.etb2bimg.com\/Themes\/Release\/theme4\/images\/bar-codes\/auto_barcode.png?mod=3118&ssl=1&w=640&resize=640&ssl=1 640w, https:\/\/mlmjbqro95r8.i.optimole.com\/cb:bOxR.6a5\/w:auto\/h:auto\/q:mauto\/f:best\/https:\/\/i1.wp.com\/st.etb2bimg.com\/Themes\/Release\/theme4\/images\/bar-codes\/auto_barcode.png?mod=3118&ssl=1&w=800&resize=800&ssl=1 800w, https:\/\/mlmjbqro95r8.i.optimole.com\/cb:bOxR.6a5\/w:auto\/h:auto\/q:mauto\/f:best\/https:\/\/i1.wp.com\/st.etb2bimg.com\/Themes\/Release\/theme4\/images\/bar-codes\/auto_barcode.png?mod=3118&ssl=1&w=1024&resize=1024&ssl=1 1024w, https:\/\/mlmjbqro95r8.i.optimole.com\/cb:bOxR.6a5\/w:auto\/h:auto\/q:mauto\/f:best\/https:\/\/i1.wp.com\/st.etb2bimg.com\/Themes\/Release\/theme4\/images\/bar-codes\/auto_barcode.png?mod=3118&ssl=1&w=1280&resize=1280&ssl=1 1280w, https:\/\/mlmjbqro95r8.i.optimole.com\/cb:bOxR.6a5\/w:auto\/h:auto\/q:mauto\/f:best\/https:\/\/i1.wp.com\/st.etb2bimg.com\/Themes\/Release\/theme4\/images\/bar-codes\/auto_barcode.png?mod=3118&ssl=1&w=1600&resize=1600&ssl=1 1600w\" loading=\"lazy\" width=\"90\" height=\"90\" fifu-data-src=\"https:\/\/mlmjbqro95r8.i.optimole.com\/cb:bOxR.6a5\/w:auto\/h:auto\/q:mauto\/f:best\/https:\/\/i1.wp.com\/st.etb2bimg.com\/Themes\/Release\/theme4\/images\/bar-codes\/auto_barcode.png?mod=3118&ssl=1\" alt> <!– <span class=\"border-bottom\"><\/span> –> <\/figure>\n<\/p><\/div>\n<\/p><\/div>\n<\/p><\/div>\n<\/p><\/div>\n<\/p><\/div>\n<\/p><\/div>\n<\/p><\/div>\n<\/section>\n<p> <span id=\"etb2b-news-detail-page\" class=\"etb2b-module-ETB2BNewsDetailPage\" data-news-id=\"127615186\" data-news_link=\"https:\/\/auto.economictimes.indiatimes.com\/news\/industry\/european-carmakers-gain-major-access-as-india-eases-tariffs-under-eu-fta\/127615186\"> <\/span> <!-- Next Story Placement --> <!– <\/section>\n<p> –>\n<\/p><\/div>\n<p><\/main> <!-- Footer Section --> <!-- OneTrust Cookies Consent Notice start for auto.economictimes.indiatimes.com --> <!-- OneTrust Cookies Consent Notice end for auto.economictimes.indiatimes.com --> <\/div>\n<p> <!– "logo": "”, –><\/p>\n<p><strong><a href=\"https:\/\/blockads.fivefilters.org\"> <\/a><\/strong> <a href=\"https:\/\/blockads.fivefilters.org\/acceptable.html\"> <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>… to benefit major European <span class=\"match\">carmakers<\/span>, including Volkswagen Group, … Reciprocal access for Indian <span class=\"match\">automakers<\/span> In return, the EU … will offer Indian <span class=\"match\">automakers<\/span>\u00e2\u0080\u0094including Mahindra & Mahindra … more deeply into global <span class=\"match\">automotive<\/span> supply chains. However, …<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"","fifu_image_alt":"","footnotes":""},"categories":[1],"tags":[],"class_list":["post-65861","post","type-post","status-publish","format-standard","hentry","category-news","wpcat-1-id"],"_links":{"self":[{"href":"https:\/\/new7.shop\/zerocostfreehost\/index.php\/wp-json\/wp\/v2\/posts\/65861","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/new7.shop\/zerocostfreehost\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/new7.shop\/zerocostfreehost\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/new7.shop\/zerocostfreehost\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/new7.shop\/zerocostfreehost\/index.php\/wp-json\/wp\/v2\/comments?post=65861"}],"version-history":[{"count":0,"href":"https:\/\/new7.shop\/zerocostfreehost\/index.php\/wp-json\/wp\/v2\/posts\/65861\/revisions"}],"wp:attachment":[{"href":"https:\/\/new7.shop\/zerocostfreehost\/index.php\/wp-json\/wp\/v2\/media?parent=65861"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/new7.shop\/zerocostfreehost\/index.php\/wp-json\/wp\/v2\/categories?post=65861"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/new7.shop\/zerocostfreehost\/index.php\/wp-json\/wp\/v2\/tags?post=65861"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}