Quellen zufolge will Indien im Handelsabkommen mit der EU die Zölle auf Autos auf 40 % senken

NEW DELHI/BRUSSELS, Jan 25 (Reuters) – India plans to slash tariffs on cars imported from the European Union to 40% from as high as 110%, sources said, in the biggest opening yet of the country’s vast market as the two sides close in on a free [trade pact](https://www.reuters.com/sustainability/climate-energy/india-eu-likely-announce-conclusion-trade-talks-tuesday-2026-01-23/) that could come as early as Tuesday.

Prime Minister Narendra Modi’s government has agreed to immediately reduce the tax on a limited number of cars from the 27-nation bloc with an import price of more than 15,000 euros ($17,739), two sources briefed on the talks told Reuters.

This will be further lowered to 10% over time, they added, easing access to the Indian market for European automakers such as Volkswagen, Mercedes-Benz and BMW.

The sources declined to be identified as the talks are confidential and could be subject to last-minute changes. India’s commerce ministry and the European Commission declined to comment.

# PACT ALREADY DUBBED ‚MOTHER OF ALL DEALS‘

India and the EU are expected to announce on Tuesday the conclusion of [protracted negotiations](https://www.reuters.com/sustainability/climate-energy/india-eu-free-trade-pact-whats-agreed-whats-stake-after-years-talks-2026-01-23/) for the free trade pact, after which the two sides will finalise the details and ratify what is being called „the mother of all deals.

The pact could expand bilateral trade and lift Indian exports of goods such as textiles and jewellery, which have been hit by 50% U.S. tariffs since late August.

India is the world’s third-largest car market by sales after the U.S. and China, but its domestic auto industry has been one of the most protected. New Delhi currently levies tariffs of 70% and 110% on imported cars, a level often criticised by executives, including [Tesla chief](https://www.reuters.com/business/autos-transportation/tesla-says-indias-100-car-tariffs-make-customers-anxious-2025-04-23/) Elon Musk.

India is world largest democracy. We should cooperate more.