The India-EU trade deal has eliminated tariffs on Indian textile and leather exports to the EU, which is being seen as a significant relief for sectors hit by the 50% import duty imposed by the US.
The new tariff rates are:
- Textiles, apparel and apparel: 0% tariff vs 12% previously
- Leather and footwear: 0% tariff from earlier 17%
India-EU FTA: Impact on textile industry
People familiar with the matter said the 0% import duty makes Indian apparel and textiles meaningfully cheaper on European shelves — meaning big orders for Indian apparel makers in manufacturing hubs from Tirupur in Tamil Nadu to Ludhiana in Punjab.
Essentially, Indian apparel manufacturers now have full access to the EU’s $263.5 billion textile market, where exports are currently valued at $7.2 billion.
India-EU FTA: Impact on leather industry
The 0% import duty will allow the EU’s $100 billion leather and footwear industry to increase sourcing from India – particularly from the clusters of Agra-Kanpur in Uttar Pradesh and Vellore-Ambur in Uttar Pradesh – thereby creating formal jobs and new enterprises in these sectors.
Improved competitiveness – driven by demand for medium to premium leather goods – could increase exports in tanning, finishing and footwear manufacturing.