India and the European Union made meaningful strides in their ongoing Free Trade Agreement (FTA) negotiations, with several key chapters reaching closure during the latest round of discussions. According to reports, the two sides concluded talks on chapters related to goods trade, customs procedures, intellectual property rights (IPR), and regulatory transparency. These agreements mark an important step forward in the long-standing negotiations, which aim to bolster trade and economic cooperation between the two major economies.
Despite this progress, critical discussions on the EU’s proposed Carbon Border Adjustment Mechanism (CBAM) and steel trade regulations remain unresolved. The CBAM, which will impose tariffs on carbon-intensive imports such as steel and cement, is a contentious point for India, whose export-driven sectors could face significant cost pressures if the mechanism is implemented without exemptions or transitional arrangements. Indian negotiators have raised concerns over the discriminatory nature of the CBAM and its potential to act as a non-tariff barrier, especially impacting the competitiveness of Indian steel exports to Europe.
Simultaneously, talks around steel trade access and safeguards are ongoing, as both parties aim to ensure fair market practices while protecting domestic industries. India has been seeking greater market access for its steel and other manufactured goods, while the EU is focused on environmental compliance and sustainability standards.
The India-EU FTA has been under negotiation for more than a decade, and these recent developments reflect renewed momentum in diplomatic and trade engagements. Both sides are expected to meet again soon, with the goal of finalizing a comprehensive agreement that balances trade liberalization with climate action and industrial interests.
