India and the European Union are working to conclude a comprehensive and balanced Free Trade Agreement (FTA) by the end of this year, Union Commerce and Industry Minister Piyush Goyal said while addressing the 65th Annual Session of the Automotive Component Manufacturers Association (ACMA). He stressed that the deal must be fair for both sides and highlighted the positive direction of ongoing talks.
Goyal said the FTA would open significant opportunities in trade, investment, technology transfer, and R&D collaborations. He expressed confidence that India’s automotive component sector, known for its resilience and global competitiveness, will gain substantially. “The sector will find the India-EU partnership attractive, exciting, and full of potential to grow, collaborate, and innovate,” he said.
The Minister underlined that the agreement would encourage joint ventures and technology partnerships with European companies. He noted India’s strengths in cost competitiveness, design, and research, coupled with a skilled talent pool, make the country an attractive hub for global auto firms. Such collaborations, he added, will reduce costs, boost productivity, generate jobs, and position India as a leading hub for automotive components.
European Union Commissioner for Trade and Economic Security, Maroš Šefčovič, echoed this optimism, calling the negotiations the most intensive and constructive ever between India and the EU. He said both sides are committed to finalising a “ground-breaking” deal by year-end, in line with the commitment of Prime Minister Narendra Modi and European Commission President Ursula von der Leyen.
Šefčovič stressed that the agreement must be a win-win for producers, exporters, and consumers, while also promoting investment, innovation, and sustainable practices. “India is fast becoming a key engine of the global economy, and Europe’s technology and scale can add significant value to India’s growth story,” he said.
Goyal also spoke about India’s aspiration to increase vehicle penetration from 34 cars per 1,000 people to much higher levels, which will create fresh opportunities for the auto component industry. He said the automobile sector has been a “torchbearer of Make in India” and will continue to drive job creation, exports, and high-quality manufacturing.
The Minister further hailed India’s resilience during the COVID-19 pandemic, recalling how the country fulfilled its global commitments by supplying medicines and vaccines to over 100 nations, building its reputation as a trusted partner.
On recent tax reforms, Goyal praised the reduction of GST rates on auto parts from 28% to 18% and tractors to 5%, calling it a landmark relief for the industry. He said the move will make spare parts more affordable, formalise the sector, create jobs, and expand demand across the value chain.
Concluding with a quote from Ratan Tata “Take the stones people throw at you and build a monument” Goyal urged the industry to stay confident and resilient as India strengthens its global standing.
