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Proposed trade pact with EU will provide huge opportunities for domestic auto industry: Rajesh Agrawal
Sep-12-2025

Special Secretary in the Department of Commerce Rajesh Agrawal has said that the proposed trade pact with the European Union (EU) will provide huge opportunities for the domestic auto industry to boost exports and forge new partnerships with leading automobile giants from the 27-nation bloc. He said India is currently negotiating its biggest free trade agreement (FTA) with the European Union, and it is important particularly for the Indian automobile sector, as the auto sector is one of the bloc's key strengths. 

A team of EU officials is holding the 13th round of negotiations for the pact in the national capital, which is progressing at a faster pace. These remarks are important as the EU is seeking duty concessions in the auto sector from India. India has provided duty concessions in the sector for the UK firms under a trade pact between the two countries, which was signed on May 6 this year. Under the pact, tariffs on automotive imports will be reduced from over 100 per cent to 10 per cent under quotas on both sides. India has included adequate safeguards in the FTA with the UK to protect its sensitive sectors. In the automobile segment, the import duty will be reduced over a 10-15-year period.

Agrawal said that these agreements will help not only create domestic capacities but also ensure that the country's entire supply chain has enough resilience. He said ‘for the automobile sector also, if you look at each one of the FTAs, we have been able to secure a much deeper market access for our automobile and auto component sector, and at the same time, India is also protecting its sensitive sectors and providing more protection to them, wherever required.’ To protect sensitive sectors like auto, he said, India always tries to include provisions for the gradual opening up of these segments. He added ‘we are trying to negotiate those provisions also wherein we see that our market access is gradually opened up in over 5 to 10 years in many sectors, and in many sectors, we reserve the right beyond a certain quota to see that our complete market is not open for the FTA part’.  

He further said 'so we are trying to calibrate a lot of these negotiations in a manner where we preserve, protect and support our domestic industry. But at the same time, give some access to our emerging market to those countries also in exchange of which they can give us deep market access in their economy because we believe economies of scale and deeper integration with global economies will also play a very important role in how the global supply chains are rearranged in months and years to come and if we have to be a very important dominant part of it, I think we need to play a proactive role in this.' 
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