Challenges Faced by EU Companies in India
- Existing regulations and trade barriers
- Quality Control Orders (QCOs) and Customs procedures are overly complicated and should be simplified or done away with totally.
- Streamlining the labelling, testing, and import processes is of utmost importance.
- Facilitate cross border digital transactions without data localisation restrictions.
- Issues relating to labour and intellectual property
- The hindrance of complexity in the process of visa and work permits has been detrimental to mobility of talents.
- Weak enforcement of intellectual property (IP) laws exposes businesses to risks of counterfeit goods and data.
Investment Outlook & Business Sentiment
- Strong confidence in the growth of the Indian market
- 92% of European businesses feel that there will be a positive impact of the proposed EU-India Free Trade Agreement (FTA).
- 72% will most likely invest more in India within two years.
- 80% view India as an expanding sales market and 61% view it as an emerging production hub.
EU Investors Focus on Key Sectors
More technology driven and sustainable industries can be expected as India improves trade practices.
76% of firms surveyed plan to invest beyond pre 2025 levels.
Why India?
- 66% said political stability was an advantage.
- 60% said India gained from its geopolitical position.
- 60% liked having a skilled labour force.
- 59% said that India is gradually easing the way of doing business.
Proposed FTA: A Game changer for EU India Trade
- Historically, the EU is India’s primary trading partner, emanating 12.2% of the trade share in total Indian trade in 2023.
- The EU-India FTA is expected to grow trade in goods & services, bringing economic growth.
It reflects as the EU firms remain optimistic about India’s market potential while identifying regulatory hurdles to be cleared. There will be more investment and trade opportunities under the EU India FTA once the aforementioned major trade, taxation, and regulatory barriers are addressed.
