India, EU to grant MFN status for 5 years in draft trade pact
India, EU to grant MFN status for 5 years in draft trade pact
Draft India-EU trade pact proposes five-year MFN status with sweeping tariff reductions across most goods.
A draft India-EU trade agreement outlines granting each other Most Favoured Nation status for five years, starting from the date the deal enters into force. The move signals a deepening of economic ties and sets the framework for broader tariff liberalisation.
The draft shows the FTA eliminating or reducing tariffs on 96.6% of EU exports to India by value and 99.5% of Indian exports to the EU by value, marking a substantial opening of markets on both sides.
Negotiations on the pact were relaunched in 2022 after years of talks, and the current draft is viewed as a strategic turning point that could help stabilise the international order by strengthening trade links between the two economies.
Analysts say MFN status could lead to more predictable market access and smoother dispute resolution, while governments emphasize the deal as a reflection of long-standing economic ties.
Next steps include formal ratification processes on both sides, with additional work likely on rules of origin, sector-specific commitments, and implementation timelines.
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