The proposed trade pact is expected to liberalise tariffs across a wide range of industrial goods and services, improving market access for European exporters and Indian manufacturers alike. However, negotiators have deliberately carved out protections for sensitive farm sectors, ensuring that dairy products and key agricultural items are excluded or subject to strict safeguards rather than full liberalisation.

For the European Union, the agreement represents a strategic effort to strengthen supply chains and diversify trade partnerships amid global uncertainty. For India, the pact is positioned as a growth-oriented deal that enhances exports, attracts investment and integrates the country more deeply into global value chains, without undermining farmer livelihoods or domestic milk producers.

Officials quoted in the report emphasise that India’s dairy sector remains a red line, reflecting its role in rural employment and food security. As a result, the agreement avoids opening the market to large-scale EU dairy imports, a longstanding concern for India’s cooperative-driven milk economy and millions of smallholder producers.