India-EU ‘Mother of All Trade Deals’: What It Means for Businesses & Startups

The India-EU Free Trade Agreement (FTA) has sent exciting shockwaves in business and trade enthusiasts. This deal concluded on 27 January 2026 and has been dubbed by PM Modi as the ‘Mother of All Trade Deals’. India and the European Union combined make up approximately 25% of global GDP and a market of two billion consumers. This landmark trade deal is all set to completely revamp global trade while opening the Indian and European markets like never before.

International trade education in India is going to witness massive changes as the FTA is going to revolutionise international business for the coming decades. Experts state that this trade deal could significantly offset the US-imposed tariffs sustained by the Indian economy in lieu of importing Russian oil. Let us take a closer look at the key features of this trade deal, and explore its impact on diverse industries, businesses, and startups:

Key Features of the India-EU Free Trade Agreement (FTA) on Businesses and Startups

1. Elimination of Tariffs

The deal is set to eliminate tariffs on over 95% goods traded between India and the EU. This elimination of tariffs will offset the high tariffs set by the US on Indian goods, as Indian goods will now be cheaper to import by the EU, driving trade between the two regions.

2. Professional Exchange

A framework is being set up where professionals can access short-term employment opportunities. Skilled Indian professionals in sectors like IT, engineering, healthcare etc. will be able to find opportunities in the EU through this framework, boosting employment and advancement in careers.

3. Protecting FDIs

The FTA will prescribe clearer terms for Foreign Direct Investment (FDIs) to ensure a more stable and reliable environment. This setup will boost investment opportunities for businesses and startups across different sectors as they will be able to attract foreign investments in a more streamlined manner.

4. Global Startup Support

There are dedicated provisions in the FTA to ensure that Small and Medium Enterprises (SMEs) can make the most of this trade deal. SMEs will be able to use specific contact points to raise investments and face reduced regulatory barriers in accessing European markets.

Industry-specific Impact of the India-EU Free Trade Agreement (FTA)

1. Textile, Leather, Jewellery Sector

Zero-duty or preferential access will be given to labour-intensive Indian sectors like textile, leather, and jewellery sectors, helping them beat competition from other nations.

2. Automobile Sector

There will be an immediate and significant drop of duties imposed on high-end European cars from 110% to 40% with gradual reduction of 10% in coming years. However, the electronic vehicle (EV) sector will remain protected to support domestic manufacturing.

3. Pharmaceutical Sector

The Indian generic medicine manufacturers will gain access to European markets with reduced duties and shorter approval timelines. India will also lower or completely abolish tariffs on over 90% European medical equipment.

4. Agriculture and Dairy Sector

Key EU agricultural exports like wine, olive oil, and confectionery will face drastically reduced tariffs from 150% to 75%. Sensitive agricultural and dairy sectors/products are not included in the agreement to protect local Indian farmers.

5. Climate and Environment

500 million Euros have been pledged by the EU to provide innovative climate support to India over the next two years. This will positively impact sustainable industrial transformation in India.

Impact of the India-EU Free Trade Agreement (FTA) on Global Management Courses

The India-EU Free Trade Agreement (FTA) is going to aggressively impact startup incubation and innovation programs. There is going to be a massive shift on how management education is imparted going forward. Experts and academicians will study the trade agreement which once upon a time seemed impossible and is now a thriving reality.

Opting for an MBA in International Business can be the key to pursuing a career in such fast-shifting global trade scenarios. Pursuing such a program from one of the top business schools in Nashik like Sandip University can further enhance your career prospects at the global level. Sandip University’s MBA programs are industry-relevant with global immersion opportunities for a fast-track career.

With the right guidance, learning, and training opportunities, you too can join India’s growth story on the global stage. Good luck!