Impact Analysis of the India-EU Free Trade Agreement on Indian Horticulture

The paper examines the potential effects of the proposed India-European Union (EU) Free Trade Agreement (FTA) on India's horticultural trade.India, a key player in global horticulture, is exploring the trade benefits and challenges of reducing tariffs with the EU.The study uses the SMART model to simulate the impact of tariff elimination on various trade parameters, comparing the base year 2019 with a counterfactual scenario where tariffs are removed.Results indicate a significant overall trade increase in agriculture (238 per cent), with notable growth in tea, coffee, and spices (357 per cent), vegetables, fruits, and nuts (33 per cent), and cocoa (9 per cent).The findings suggest that the FTA could benefit Indian horticultural stakeholders as trade creation surpasses trade diversion.The study emphasizes the need for policymakers to consider the benefits and challenges of such agreements and to support domestic producers by improving competitiveness, infrastructure, and access to financial and technical resources.While the FTA presents growth opportunities, particularly for EU exports to India, it also highlights concerns for labor-intensive industries like tea and coffee.The research provides critical insights for shaping future trade policies between India and the EU.