India-EU FTA (Operational by 2027)
- Covers 2 billion people
- India gains zero-duty access for 99% of exports (textiles, marine)
- Challenge: EU’s Carbon Border Adjustment Mechanism (CBAM) imposes $2-4 billion annual compliance burden on Indian steel/cement
- India uses high-emission blast furnaces vs EU’s scrap-based electric arc furnaces
- FTA establishes India as a strategic hedge against China
EU-Mercosur Deal — Stalled
- Stalled by European Court of Justice (ECJ) due to massive protests by European farmers fearing cheap South American beef
- Amazon deforestation concerns also a factor
- Highlights how environmental conditionalities and agrarian politics dominate global trade
India-US Interim FTA
- US removed 25% penalty tariff on Indian goods (imposed over Russian oil imports)
- India committed to $500 billion purchase agreement over 5 years (GPUs, oil, gas, aircraft)
- India protected sensitive domestic sectors like dairy
UPSC Angle
- GS2: International relations, bilateral agreements
- GS3: Economy, trade policy, CBAM
📌 Facts Corner — Knowledgepedia
India-EU FTA:
- Coverage: 2 billion people
- India’s zero-duty access: 99% of exports
- CBAM burden on India: $2-4 billion/year (steel, cement)
India-US Interim FTA:
- US penalty tariff removed: 25%
- India purchase commitment: $500 billion over 5 years
- Protected sectors: dairy
EU-Mercosur:
- Status: stalled (ECJ, farmer protests, deforestation concerns)