India-EU FTA 'pretty close' to final deal: 'Non-tariff barriers' key issue, says Goyal; both sides actively working to resolve it
NEW DELHI: Union commerce minister Piyush Goyal, during his three-day official visit to Sweden, said India and the European Union are "pretty close" to finalising the long-awaited Free Trade Agreement (FTA).
He added that the only major issue left to be resolved between the two is "non-tariff barriers."
"We are very much on track to achieve that (FTA). Significant progress has been made. More than half the chapters are ready. In terms of content, I would say we are almost 90 per cent ready for market access. The important issues to be addressed are non-tariff barriers and how we will make it smoother, easier, and better to do business between the EU and India," Goyal told reporters here.
He added that India and the EU are actively discussing ways to make business easier for companies on both sides.
Addressing "non-tariff barriers" is crucial for the proposed Free Trade Agreement (FTA), and both sides are working together to resolve these issues, he noted.
"Unless countries recognise that over regulation and barriers to trade will be met with reciprocal action, everybody suffers. We are committed to deregulation, to finding solutions to the high cost of regulation, the non-tariff barriers that these regulations cause and the impediments to free trade.
I am quite hopeful that we will find very robust solutions to this problem," the minister said, expressing optimism about finding strong solutions.
Goyal is on an official visit to Sweden to meet his Swedish counterpart and engage with companies to boost trade and investment ties between the two countries. Sweden is part of the 27-member European Union.
Several key Indian exports continue to face high non-tariff barriers in the EU, including chillies, tea, Basmati rice, milk, poultry, bovine meat, fish, and chemical products.
Countries establish non-tariff measures (NTMs) as domestic regulations to safeguard human, animal, plant health and environment. These comprise technical measures including regulations, standards, testing, certification, pre-shipment inspection, and non-technical measures such as quotas, import licensing, subsidies, and government procurement restrictions.
NTMs transform into non-tariff barriers (NTBs) when they become arbitrary and exceed scientific justification, creating trade obstacles.
Indian exports remain significantly under potential due to NTBs in various regions, including the EU, US, China, Japan, and Korea.
According to GTRI, the EU has reduced the minimum residual limit (MRL) for tricyclazole in rice to 0.01 mg per kg, compared to its previous tenfold higher limit.
The EU has established MRL for aflatoxins B1 in chilies and other spices at 5 to 10 ppb (parts per billion).
The minister confirmed that discussions regarding services and rules of origin have commenced.
To push forward the ongoing FTA talks, EU Commissioner for Trade and Economic Security Maros Sefcovic is likely to visit New Delhi on June 28-29.
On the Carbon Border Adjustment Mechanism (CBAM), Commerce Minister Piyush Goyal said it acts as a non-tariff barrier and is "not good" for India. He warned that imposing such a carbon tax would be unfair to Indian industries and that India would have to respond if the EU goes ahead with it.
"Our talks are going on the issue to find ways to deal with this," the minister noted and said he is hopeful that a positive outcome will emerge.
Earlier on February 28, Prime Minister Narendra Modi and European Commission President Ursula von der Leyen agreed to finalise a long-pending free trade agreement (FTA) by the end of this year, as concerns grow over US President Donald Trump's tariff policies.
India and the 27-member EU bloc resumed FTA negotiations in June 2022 after an eight-year pause.
In 2024–25, bilateral trade in goods between India and the EU reached $136.4 billion, with Indian exports at $75.75 billion and imports at $60.65 billion—making the EU India's largest trading partner for goods.
The EU accounts for about 17% of India's total exports, while India makes up 9% of the EU's global exports. European companies have invested over $117 billion in India, with around 6,000 firms operating in the country.
Meanwhile, Indian investments in the EU are estimated at $40 billion.
Later in the evening, Goyal also attended a dinner hosted by the Sweden-India Business Council and the Indian Embassy, where he met Swedish business leaders.
Goyal showcased India's growing investment potential and reaffirmed the country's commitment to sustainable growth under its "zero defect, zero effect" manufacturing policy.
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