India-EU FTA opens import route for European carmakers even as near-term price cuts unlikely

Under the FTA, India has agreed to cut tariffs on imports of fully built cars over a period of time from 110% to 10%, with a quota of 250,000 cars annually. To be sure, the India–EU FTA does not go into effect immediately, with both sides now starting processes to ratify the deal. The agreement is expected to kick in only by 2027. The trade deal comes as India and the European Union seek to hedge against the US, with Prime Minister Narendra Modi saying the agreement would strengthen India’s manufacturing and services sectors and boost investor confidence. The tariff…