NEW DELHI/BRUSSELS, Jan 25 (Reuters) – India plans to slash tariffs on cars imported from the European Union to 40% from as high as 110%, sources said, in the biggest opening yet of the country’s vast market as the two sides close in on a free trade pact that could come as early as Tuesday.
Prime Minister Narendra Modi’s government has agreed to immediately reduce the tax on a limited number of cars from the 27-nation bloc with an import price of more than 15,000 euros ($17,739), two sources briefed on the talks told Reuters.
This will be further lowered to 10% over time, they added, easing access to the Indian market for European automakers such as Volkswagen, Mercedes-Benz and BMW.
The sources declined to be identified as the talks are confidential and could be subject to last-minute changes. India’s commerce ministry and the European Commission declined to comment.
badgermail on
A trade deal with India is an immigration deal. This will be terrible for the EU.
RimandRam on
Be careful with India. They will reduce import duty and jack up local cess and tax. At the end yes the same tax amount, just different terminology.
bxzidff on
What was the reason for the currently higher tariffs? Do India have any car industry to speak of? Or trying to get one? Or is it a response to some EU tariffs in another sector?
Anyway, good with more trade diversification. May we be mutually prosperous
Zhukov-74 on
India‘s duties on imported vehicles are as high as 110% so this would be a major benefit for the European car market.
Not many would buy even with 20% discount. Many western companies that have even gone local to India learned this the hard way and withdrew long ago. They have only stayed to outsource cheap labor. The culture of India is to bargain until the other side loses money.
Beyllionaire on
Somehow I feel like all these trade deals are just about saving the German car industry.
DepressiverVersager on
i think its good to intensify trade relations with the upcoming countries (BRICS). We can both benefit a lot from working together.
ajicrystal on
Thank you to Trump and the US for speeding up these talks which have been going on since 2007. Also thanks to them India has signed free trade deals with UAE, UK, Oman, New Zealand and Australia and improved relations with China and Canada.
I hope this deal includes co-operation on reducing dependency on American tech for both.
oldmanbeganat47 on
Not a bad deal for EU imho
heatrealist on
Replacing American 15% tariffs with Indian 40% tariffs🤪
13 commenti
NEW DELHI/BRUSSELS, Jan 25 (Reuters) – India plans to slash tariffs on cars imported from the European Union to 40% from as high as 110%, sources said, in the biggest opening yet of the country’s vast market as the two sides close in on a free trade pact that could come as early as Tuesday.
Prime Minister Narendra Modi’s government has agreed to immediately reduce the tax on a limited number of cars from the 27-nation bloc with an import price of more than 15,000 euros ($17,739), two sources briefed on the talks told Reuters.
This will be further lowered to 10% over time, they added, easing access to the Indian market for European automakers such as Volkswagen, Mercedes-Benz and BMW.
The sources declined to be identified as the talks are confidential and could be subject to last-minute changes. India’s commerce ministry and the European Commission declined to comment.
A trade deal with India is an immigration deal. This will be terrible for the EU.
Be careful with India. They will reduce import duty and jack up local cess and tax. At the end yes the same tax amount, just different terminology.
What was the reason for the currently higher tariffs? Do India have any car industry to speak of? Or trying to get one? Or is it a response to some EU tariffs in another sector?
Anyway, good with more trade diversification. May we be mutually prosperous
India‘s duties on imported vehicles are as high as 110% so this would be a major benefit for the European car market.
[India’s 110% Car Tariffs Become Harder to Defend in Trump Era](https://www.bloomberg.com/news/articles/2025-04-23/india-s-110-car-tariffs-become-harder-to-defend-in-trump-era)
Not many would buy even with 20% discount. Many western companies that have even gone local to India learned this the hard way and withdrew long ago. They have only stayed to outsource cheap labor. The culture of India is to bargain until the other side loses money.
Somehow I feel like all these trade deals are just about saving the German car industry.
i think its good to intensify trade relations with the upcoming countries (BRICS). We can both benefit a lot from working together.
Thank you to Trump and the US for speeding up these talks which have been going on since 2007. Also thanks to them India has signed free trade deals with UAE, UK, Oman, New Zealand and Australia and improved relations with China and Canada.
I hope this deal includes co-operation on reducing dependency on American tech for both.
Not a bad deal for EU imho
Replacing American 15% tariffs with Indian 40% tariffs🤪
It’s worth noting that last year’s UK-India Free Trade Agreement [reduced the Indian tariff on UK manufactured cars to 10%, subject to a quota](https://www.gov.uk/government/publications/uk-india-trade-deal-conclusion-summary/uk-india-trade-deal-conclusion-summary).
Therefore I would hope that an Indian agreement to have a 40% tariff for EU cars would be quota free.
but at what cost? or they are doing this from the goodness of their hearth 🙂