US EditionIndia plans to slash car tariffs to 40% in trade deal with EU: Reuters
India will immediately cut tariffs to 40% on 200,000 EU combustion-engine cars annually, with further reductions to 10% phased over time, excluding electric vehicles for five years.
- On Tuesday, India plans to cut import tariffs on EU cars to 40% from as high as 110%, with immediate reductions for a limited set of models, sources said.
- Geopolitical and trade pressures have pushed negotiators toward compromise as the European Union seeks supply‑chain diversification and India aims for technology, investment, and access to its $4.2 trillion economy.
- Negotiators say the tariff path will be phased, reaching about 10% over time, while battery electric vehicles will be excluded from duty cuts for five years to protect Mahindra & Mahindra and Tata Motors.
- Lower taxes will let carmakers price imported models more competitively and test demand, while investors and suppliers line up new investment as the Indian market expected to grow to 6 million units a year by 2030.
- If signed, the pact will still need European Parliament approval, which could take at least a year, while the Carbon Border Adjustment Mechanism and agriculture and dairy remain unresolved.
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According to sources, the measure is part of a free trade agreement being negotiated between the country, governed by Narendra Modi, and the European bloc; tariffs could reach 10% over time.
The Free Trade Pact has been named "mother of all agreements".
Even before the trade summit with the EU, a partner country seems to be planning a deal. According to this, the country wants to reduce tariffs on EU cars to 40 percent.
'Successful India makes world stable, prosperous and secure': EU chief ahead of landmark free trade deal
European Commission President Ursula von der Leyen on Monday called for a "successful" India and said it would make the world more "stable, prosperous, and secure". von der Leyen is on a three-day visit to India and was the chief guest for the 77th Republic Day. "It is the honor of a lifetime to be Chief Guests at the Republic Day celebrations. A successful India makes the world more stable, prosperous and secure. And we all benefit," von der L…
India opens its car market to the EU and drastically reduces tariffs on imported cars. European manufacturers benefit from new opportunities and cheaper prices.
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