Indian exporters stand on the brink of a major breakthrough. The impending India-EU Free Trade Agreement could generate $10-11 billion in extra exports, per Rubix Data Sciences’ insightful report. The beauty? No need for capacity hikes—simply redirect US tariff-hit shipments.
Breaking it down: India’s top 15 US product categories, valued at $45 billion (52% of total), include 12 categories of $21 billion with minimal EU penetration. Channeling half this volume through FTA benefits like tariff cuts promises a seismic shift in trade patterns.
Bilateral trade has flatlined at $136.5 billion from FY23 to FY25, despite EU becoming India’s biggest partner in FY25. India’s EU market share lags at 2.9% imports and 1.9% exports, with heavy reliance on five countries for 70%+ of outflows.
The EU grapples with 1.4% growth in its massive $21.1 trillion economy, compounded by downturns in key members. Investment-wise, the EU’s $119.2 billion FDI in India since 2000 represents a solid 16.5% of inflows.
This agreement isn’t just about trade numbers; it’s a strategic realignment, helping India navigate US barriers, expand footprints, and strengthen long-term EU partnerships.