The EU-India Trade Deal: A Pivotal Moment for Dairy

A high-stakes negotiation between India and the European Union could reshape the global agribusiness sector. The potential free trade agreement (FTA) is seen as crucial for India to integrate more deeply into global supply chains. This proposed deal symbolizes a strategic shift towards stronger economic ties with Western economies, creating new avenues for international commerce.

Progress has been made with negotiations on 11 of 27 chapters concluded, but agriculture and dairy remain contentious points. These discussions underscore the complex nature of dairy economics, balancing open markets with local industry protection. The negotiations test how both sides will navigate these competing interests to achieve a beneficial outcome.

Another significant issue is the EU’s Carbon Border Adjustment Mechanism (CBAM), impacting sectors like steel and cement starting in 2026. India seeks concessions similar to those granted to the US. This illustrates the growing overlap between environmental policies and trade, with future agreements likely influenced by sustainability-focused regulations.

Economic ties between the EU and India already include $137.41 billion in goods and $51.45 billion in services trade for 2023-24. The editorial suggests a comprehensive pact could unlock further potential, enhancing India’s role in global commerce and making it a more attractive investment destination.

Ultimately, India’s pursuit of greater integration into global supply chains, emphasized by the EU pact and potential membership in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, is a strategic effort to modernize its food supply chain and solidify its standing in international agribusiness.