New Delhi [India], January 30 (ANI): The India-European Union Free Trade Agreement (FTA) is expected to have its most visible impact on the premium automobile segment, while also opening new growth pathways for other sectors.

Union Minister Piyush Goyal on Fridays said that European automobile manufacturers understand very well that manufacturing in India is more profitable, and this will eventually create more jobs in India. In an interaction with ANI, Goyal said, as we enter into international agreements with developed countries, India's vision of becoming a developed country moves closer to reality.

Speaking on the impact of the India-EU tariffs on the Indian automobile sector, the minister said, 'The Indian auto industry is doing exceptionally well. We haven't opened up the market for cars that sell for up to 25-30 lakh rupees. We have protected the auto industry completely.'

'If we allow luxury cars to enter the market here, and they see even a small market share, then they will eventually be manufactured here as well,' the minister said.

Industry experts believe that for the auto industry, the agreement is poised to redefine the top end of the passenger vehicle market. With proposed reductions in import duties on select European cars, global manufacturers are likely to reassess pricing strategies and product launches in India, particularly in the luxury and high-technology segments.

Poonam Upadhyay, Director at Crisil Ratings, explained that the impact would be concentrated at the premium level rather than across overall volumes.

'India's proposal to sharply reduce import tariffs on passenger vehicles originating from the European Union (EU) is likely to have the most visible impact at the top end of the market, rather than on the overall industry volume. The proposal entails lower duties from 110% currently to about 40% initially and 10% eventually. on a quota of around 250,000 cars priced above EUR15,000. That would give European original equipment manufacturers (OEMs) room to price imported models more competitively, expand their model range and recalibrate launch price points,' Upadhyay noted.

On the India-EU FTA, Goyal emphasised that the agreement is a win-win deal that will drive economic growth and create new opportunities for Indian businesses and citizens.

Goyal said, 'This FTA between the EU and India places India at the high table of international geopolitics. Under Prime Minister Modi's leadership, India has gained recognition and importance across the world. The world sees India as the fastest-growing large economy, a country with strong macroeconomic fundamentals, and a nation experiencing rapidly increasing demand generated by its 1.4 billion people, an aspirational, young India full of talent and skills.'

'This will give a huge boost to 'Make in India'. It will essentially open up a massive market for 'Make in India' a market of 27 countries, which is five times larger than India's own market...This will allow us to benefit from economies of scale, provide Indian consumers with better quality and more affordable goods, and enable Indian goods and services to reach the international market,' the minister said. (ANI)