Have you gone to a liquor store hoping to get your favorite imported liquor but kept it back on the shelf after seeing the heavy price tag? That is about to change soon! India and the European Union (EU), on January 27, 2026, announced the conclusion of negotiations over a free trade agreement (FTA). Under this FTA, tariffs on most imported wines, spirits, and beer are set to drastically drop down, making them cheaper for Indian buyers. Let’s take a closer look at how tariffs will work under the new India-EU Free Trade Agreement 2026.
On Tuesday, January 27, 2026, India’s Commerce Minister Piyush Goyal and European Commissioner for Trade and Economic Security Maroš Šefčovič signed the joint announcement on the conclusion of the negotiations on the FTA. They signed the document in the presence of Indian Prime Minister Narendra Modi and European Commission President Ursula von der Leyen, as well as President of the European Council António Costa.
“We have delivered the mother of all deals,” Ms. von der Leyen stated in her statement. She continued, “We are creating a market of 2 billion people. This is a tale of two giants – the world’s second- and fourth-largest economies. Two giants who choose partnership in a true win-win fashion. A strong message that cooperation is the best answer to global challenges”.
The India-EU Trade Agreement conclusion marks the end of the two decade-old process when talks were first initiated in 2007. Many experts have said that this deal would be “one of the biggest” bilateral deals in the world.
The India-EU FTA would see the EU drop tariffs on 99.5% of items India exports to the region. Most tariffs will go down to 0% immediately once the agreement comes into effect. India, on the other hand, will give tariff concessions on 97.5% of the traded value between the two economies. The deal is expected to double EU exports to India by 2032. Besides that, it also includes climate support funding to back India’s emissions-cutting efforts.
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Under the India-EU FTA, import tariffs on wines, currently set as high as 150%, will sharply reduce to 75% once the agreement is into effect. It will be progressively lowered to as little as 20 per cent for premium wines and 30 per cent for mid-range wines. This means that imported wine prices in India after the EU trade deal will be significantly lower than their current prices.
The agreement also lowered import duties on spirits, including Republic of Ireland’s whiskey. It is presently levied at rates of up to 150% and will be reduced to 40%. Similarly, beer import tariffs will be lowered from 110% to 50%.
These duty reductions are expected to lower shelf prices of alcoholic beverages from Europe and make them more accessible for Indian consumers.
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The India-EU agreement will be an ambitious trade opening that will cover extensive tariff cuts across sectors. The pact will deepen economic ties between the world’s second largest and fourth largest economies, strengthen bilateral trade, and reinforce a shared commitment to promoting global trade.
