Archive · 25 Dec 2025
India-EU Trade Talks Focus on Carbon Tax, Critical Minerals
India and the European Union are having important talks about trade.
They have already talked 14 times and are now in the final stages.
India's minister will visit the EU soon to discuss things like carbon taxes, special minerals, and rules for selling products.
The EU wants India to not put any limits on sending them special minerals.
India wants some exceptions for sending steel to the EU.
They are also talking about selling special foods that come from specific places.
Both sides want to make it easier to sell more things to each other.
The EU is India's biggest trading partner, and they are trying to make a big trade deal by the end of the year.
India's exports are expected to rise to $850 billion in the financial year ending 2025-26, but they might face challenges due to global trade issues and new carbon taxes.
India and the EU are in the final stages of FTA negotiations, with 14 rounds already completed.
Key discussion points include the Carbon Border Adjustment Mechanism (CBAM), critical minerals, and Geographical Indications (GI).
The EU wants no restrictions on the export of critical minerals from India, while India seeks carve-outs for stainless steel exports.
India is seeking recognition as a data-secure country to enable trade in digital services under the EU's data transfer rules.
India's goods and services exports are likely to rise by 3% to $850 billion in the financial year ending 2025-26, but may face challenges due to global trade issues and new carbon taxes.
- Who
- India and the European Union
- What
- Trade talks focusing on carbon tax, critical minerals, and other trade and regulatory matters
- When
- Early next year, with a key meeting on January 8 and 9
- Where
- European Union and India
- Why
- To conclude a potential Free Trade Agreement (FTA) and address various trade and regulatory issues
India's Perspective
EU's Perspective
Critical Minerals
India's Perspective
India seeks carve-outs for stainless steel exports and wants no restrictions on the export of critical minerals to the EU.
EU's Perspective
The EU wants no restrictions on the export of critical minerals from India.
Carbon Border Adjustment Mechanism (CBAM)
India's Perspective
India is concerned about the impact of CBAM on its steel exports to the EU, which have already decreased by 24% due to compliance and reporting requirements.
EU's Perspective
The EU is implementing CBAM to impose a carbon tax on imports, aiming to reduce carbon leakage and encourage cleaner production practices.
- Negotiation Rounds Completed
- 14
- Expected FTA Conclusion
- Year-end
- EU's Proposed CBAM Expansion
- 180 downstream goods
- Bilateral Goods Trade (FY2023-24)
- $137.5 billion
- India's Request
- Carve-outs for stainless steel exports
- EU's Request
- No restrictions on critical minerals export from India
- India's Seeking Recognition As
- Data-secure country
- Projected Exports for FY26
- $850 billion
- Projected Goods Exports for FY26
- Broadly flat
- Projected Services Exports for FY26
- Over $400 billion
