EU-India trade deal leaves dairy sector unchanged amid high tariffs

EUROPE – The EU-India Free Trade Agreement has not resulted in any tariff reductions for dairy products such as cheese, milk powders, and dairy-based nutritional items.

Conor Mulvihill, director of Dairy Industry Ireland, expressed disappointment with the outcome, especially as Irish dairy exports reached unprecedented levels in 2025.

However, he remains optimistic about the potential of the Indian market in the long term, highlighting the growing demand for high-quality food and nutrition products.

Agriculture Minister Martin Heydon noted that while the deal positively impacts the agri-food sector, particularly spirits like Irish whiskey, the dairy sector did not see similar benefits.

Tariffs on Irish whiskey are expected to decrease from 150% to 40% over time, with similar reductions planned for processed foods, sheepmeat, and beer.

Minister Heydon stated that sensitive EU agricultural sectors received protection under the agreement. Nevertheless, the dairy sector’s high tariffs remain a barrier to accessing the Indian market effectively.

The unchanged tariffs and technical requirements continue to pose challenges for the dairy industry, which had hoped for more favorable terms in the agreement

The EU-India trade deal, which could eliminate up to €4 billion (US$4.75 billion) in tariffs on EU exports, has sparked mixed reactions across F&B industries.

Indian businesses, particularly in spices, tea, and processed foods, are optimistic, anticipating increased exports to the EU.

However, European agricultural sectors, notably dairy and sugar, are concerned about increased competition and the erosion of market protections.

The Free Trade Agreement (FTA) will be sent to the European Council and Parliament, and India’s Cabinet, for approval before it takes effect. According to Brussels, the EU and India trade over €180 billion (US$213 billion) in goods and services annually.

The EU stated that tariffs above 36% on European food products, which it called “prohibitive,” will be reduced or eliminated.

Indian wine tariffs will decrease from 150% to 75%, eventually reaching as low as 20%. Tariffs on olive oil will drop from 45% to zero over the next five years.

Additionally, tariffs on processed agricultural products, such as bread and confectionery, which can reach 50%, will be eliminated.

The FTA is expected to boost market access by reducing or eliminating tariffs on food products, benefiting both regions’ F&B industries. Indian food products will gain easier access to the European market, while European products can reach India at more competitive prices.

The deal will also enable cheaper imports of ingredients from Europe and improve export opportunities for Indian producers of spices, tea, and other specialty foods.

Harmonized food safety standards and product labeling could simplify cross-border trade, although Indian exporters may need to adapt to the EU’s stricter regulations.

Additionally, the FTA could foster innovation and technology transfer, with European companies investing in India’s food sector and sharing advanced processing technologies.

Indian exporters, especially those offering organic, sustainable, and plant-based products, could benefit from growing demand in Europe.

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