India’s high tariffs on European wine are set for a sharp reduction after the country and the European Union finalised a long-awaited free trade agreement, a move expected to significantly reshape market access for imported wine, spirits and beer.
Indian Prime Minister Narendra Modi said on Tuesday that the two sides had concluded a milestone trade pact hailed as “mother of all deals” after nearly two decades of intermittent negotiations.
“Yesterday, a big agreement was signed between the European Union and India,” Modi said. “People around the world are calling this the mother of all deals. This agreement will bring major opportunities for the 1.4 billion people of India and the millions of people in Europe.”
According to the EU, once the agreement comes into force, more than 90% of tariffs on EU goods exported to India will be eliminated or reduced, saving European exporters up to €4 billion (US$4.3 billion) a year.
Wine will be among the biggest beneficiaries. Import duties, currently as high as 150%, will be lowered over time to 20% for premium wines and 30% for mid-range wines over a period of time under the agreement.
However, the agreement did not specify the time frame at the moment.
India has long been known for some of the world’s highest wine tariffs. Imported wine is subject to a federal duty of up to 150%, with additional state-level taxes further inflating retail prices and limiting market access.
The trade deal is also great news for brandy, whisky and spirits producers. Import duties on spirits will be immediately reduced from as high as 150% to 40%, while beer tariffs will fall from 110% to 50%. The agreement will also strengthen legal protection for EU intellectual property in India, including trademarks.
Negotiations on the India–EU free trade agreement began in 2007 but were suspended in 2013 over differences that included automobile market access. Talks regained momentum last year as India accelerated efforts to conclude trade deals with major partners.
India has already signed similar agreements with Australia and New Zealand, which have reshaped the country’s imported wine market. Under the Australia deal, tariffs on wines priced above US$15 have been cut to 75%, with a further reduction to 25% planned by 2032. Wines priced between US$5 and US$15 saw tariffs reduced to 100% in 2022, with a cut to 50% scheduled by 2032.
As a result, Australian wine has emerged as India’s leading supplier. From January to November 2025, Australian wines accounted for 24.85% of India’s total wine import value.
Data from India’s Ministry of Commerce and Industry show that EU wine imports reached US$8.21 million in the first 11 months of 2025, up 4.17% from a year earlier. Over the same period, EU spirits imports rose 14.96% to US$84.08 million, while beer imports fell 25.14% to US$1.27 million.
Total trade between India and the EU reached US$136.5 billion in the 2024/25 financial year ending March 2025. The EU has said the agreement could eventually double its exports to India.
The formal signing of the deal is expected after a legal review process lasting five to six months.
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