EU-India deal – wiiw expert: Hardly any negative effects expected
Vienna (APA) – The trade agreement between the European Union and India is unlikely to have any significant negative effects. According to Austrian wiiw trade economist Oliver Reiter, the negotiators chose a pragmatic approach and largely excluded critical sectors such as agriculture. In terms of the expected economic impact, the deal is comparable to the EU-Mercosur agreement. In the domestic economy, the agreement with India is being received positively.
India’s Prime Minister Narendra Modi spoke of the “mother of all deals.” This should be understood with regard to the total European and Indian population, said Reiter. Economically, the agreement is comparable to the Mercosur deal. For India, the EU is the most important trading partner, but conversely only around two percent of European exports currently go to India.
Austria’s automotive suppliers and winemakers among possible beneficiaries
The world’s most populous country, with 1.45 billion inhabitants, is currently importing many high-tech products and machinery from Europe. The automotive industry as well as the beverages and spirits sector are likely to benefit the most from the agreement – Indian tariffs are currently very high here and the reductions correspondingly substantial. This also applies to Austria: automotive suppliers are likely to benefit indirectly from stronger exports by the German car industry. Beverages and spirits are already the fifth-largest product group in bilateral trade between Austria and India.
European consumers are likely to feel the agreement directly only to a small extent, said Reiter. The EU imports in particular intermediate products from India “which are then used in the production process.” Consumers would most likely notice the deal in pharmaceutical products, many of which are already being imported from India.
Domestic economy welcomes India deal
In the domestic economy, the agreement with India is, as expected, being received very positively. “There is an incredible amount of potential in this,” said Secretary General of the Federation of Austrian Industries (IV), Christoph Neumayer, on the sidelines of a press conference on Tuesday. “This is an incredibly important signal in the direction of rules-based, joint cooperation.”
President of the Austrian Federal Economic Chamber (WKÖ), Martha Schultz, then spoke in a statement of a “ray of hope and an important step in the right direction.” “In a world shaped by trade conflicts with important partners such as the USA, we must network more closely with growth regions.”
“In this changing world, we as the EU must seek additional partners and broaden our base,” said Austrian Federal Chancellor Christian Stocker (ÖVP), welcoming the agreement in a statement. “Free trade is the key to success if the EU is to be a resilient and strong player on the global stage.”
EU MPs from SPÖ and NEOS address US withdrawal
For SPÖ delegation leader in the EU Parliament, Andreas Schieder, the agreement leads to a “diversification of our trade relations and thus the reduction of dependencies on those partners who have let us down.” However, the “almost silent signing of the agreement” also shows how “smoothly an agreement can be concluded by the EU when the agricultural lobby takes its foot off the brake.”
“In a world in which countries like the USA are increasingly shutting themselves off, we are offering the counter-model,” explained EU MP Anna Stürgkh (NEOS). “With new partners, we are managing to secure our quality of life, drive innovation forward and create a safer world.” (27.01.2026)
