India-EU FTA to not change any competitive dynamics in auto industry: Mahindra Group CEO Anish Shah
The FTA strikes a very good balance between opening the market while nurturing manufacturing in India, says Mahindra Group MD & CEO Anish Shah.
- Jan 27, 2026,
- Updated Jan 27, 2026 8:18 PM IST
Amid fears that the India-EU free trade agreement could increase competition for Indian carmakers, Mahindra Group Managing Director and CEO Anish Shah clarified that the FTA will not change any competitive dynamics in the industry.
“We see a huge positive for the auto sector as it provides duty-free access to European markets and will attract European OEMs to invest further in India. This agreement is very well designed, as it lowers in-quota duties only in higher-priced segments, which will enhance scale in the core segments relevant to Make in India for the world. We feel this will not change any competitive dynamics in the industry,” Shah said in a statement.
Shah said the FTA will provide meaningful benefits across multiple sectors, as it strikes a very good balance between opening the market while nurturing manufacturing in India.
“This FTA is one of the most comprehensive agreements, covering themes such as AI, innovation, clean tech and mobility, which will boost industry growth across sectors like IT services, aerostructures, finance, agriculture and renewable energy,” the Mahindra Group CEO said.
Once the FTA is ratified, European carmakers stand to gain easier access to the world’s third-largest car market, allowing them to introduce more premium models under a calibrated liberalisation framework—an opportunity for EU brands, but one that could add competition for Indian manufacturers, according to Moody’s Ratings.
European carmakers, both luxury and mass-market manufacturers, said the forward-looking India–European Union Free Trade Agreement (FTA) will further strengthen cooperation between the two regions. “As a global company, we strongly support free-trade agreements across markets and geographies. With the EU being one of India’s largest trading partners, this agreement will further propel the Indian economy, benefit the EU as well, and truly be a win-win for both regions. We believe this agreement will benefit customers in both regions. Greater tariff certainty and a more predictable trade framework will allow us to evaluate the introduction of a wider range of European models for Indian customers,” said Piyush Arora, Managing Director and CEO of Škoda Auto Volkswagen India.
“Over time, this can support deeper technology transfer, capability building, and long-term investment in the Indian automotive ecosystem. As more details emerge, we will be able to assess the medium- and long-term implications of this agreement,” Arora added.
French carmaker Renault said the European Union–India Free Trade Agreement clearly signals the direction of closer economic and industrial collaboration between Europe and India. “For us, this is very positive news, as Renault Group has made long-term, high-value commitments to both regions. This agreement further reinforces our confidence and willingness to invest across both sides,” said Stéphane Deblaise, CEO, Renault Group India.
Hardeep Singh Brar, President and CEO, BMW Group India, said the FTA reflects the growing strategic and economic relevance of India on the global stage. “We have always advocated free trade as it enhances fair market access, strengthens economic collaboration, leverages mutual strengths, and builds more resilient supply chains, especially at a time when such cooperation is more critical than ever,” said Brar.
“The proposed phased reduction of tariffs on cars and auto components has the potential to positively impact consumer confidence, enable greater product choice, and foster technological innovation and sustainable growth within the Indian automotive sector, particularly in future mobility,” Brar added.
“At BMW Group India, over 95 per cent of our volumes come from locally manufactured ‘Made in India’ models, with fully imported vehicles accounting for only about 5 per cent of our sales. While we do not foresee any immediate price changes in the near term, the FTA could create opportunities to introduce new and niche products and, if demand scales, support deeper localisation over time. We will closely evaluate the detailed implementation roadmap, timelines and qualification criteria once the fine print of the agreement is available,” Brar explained.
Amid fears that the India-EU free trade agreement could increase competition for Indian carmakers, Mahindra Group Managing Director and CEO Anish Shah clarified that the FTA will not change any competitive dynamics in the industry.
“We see a huge positive for the auto sector as it provides duty-free access to European markets and will attract European OEMs to invest further in India. This agreement is very well designed, as it lowers in-quota duties only in higher-priced segments, which will enhance scale in the core segments relevant to Make in India for the world. We feel this will not change any competitive dynamics in the industry,” Shah said in a statement.
Shah said the FTA will provide meaningful benefits across multiple sectors, as it strikes a very good balance between opening the market while nurturing manufacturing in India.
“This FTA is one of the most comprehensive agreements, covering themes such as AI, innovation, clean tech and mobility, which will boost industry growth across sectors like IT services, aerostructures, finance, agriculture and renewable energy,” the Mahindra Group CEO said.
Once the FTA is ratified, European carmakers stand to gain easier access to the world’s third-largest car market, allowing them to introduce more premium models under a calibrated liberalisation framework—an opportunity for EU brands, but one that could add competition for Indian manufacturers, according to Moody’s Ratings.
European carmakers, both luxury and mass-market manufacturers, said the forward-looking India–European Union Free Trade Agreement (FTA) will further strengthen cooperation between the two regions. “As a global company, we strongly support free-trade agreements across markets and geographies. With the EU being one of India’s largest trading partners, this agreement will further propel the Indian economy, benefit the EU as well, and truly be a win-win for both regions. We believe this agreement will benefit customers in both regions. Greater tariff certainty and a more predictable trade framework will allow us to evaluate the introduction of a wider range of European models for Indian customers,” said Piyush Arora, Managing Director and CEO of Škoda Auto Volkswagen India.
“Over time, this can support deeper technology transfer, capability building, and long-term investment in the Indian automotive ecosystem. As more details emerge, we will be able to assess the medium- and long-term implications of this agreement,” Arora added.
French carmaker Renault said the European Union–India Free Trade Agreement clearly signals the direction of closer economic and industrial collaboration between Europe and India. “For us, this is very positive news, as Renault Group has made long-term, high-value commitments to both regions. This agreement further reinforces our confidence and willingness to invest across both sides,” said Stéphane Deblaise, CEO, Renault Group India.
Hardeep Singh Brar, President and CEO, BMW Group India, said the FTA reflects the growing strategic and economic relevance of India on the global stage. “We have always advocated free trade as it enhances fair market access, strengthens economic collaboration, leverages mutual strengths, and builds more resilient supply chains, especially at a time when such cooperation is more critical than ever,” said Brar.
“The proposed phased reduction of tariffs on cars and auto components has the potential to positively impact consumer confidence, enable greater product choice, and foster technological innovation and sustainable growth within the Indian automotive sector, particularly in future mobility,” Brar added.
“At BMW Group India, over 95 per cent of our volumes come from locally manufactured ‘Made in India’ models, with fully imported vehicles accounting for only about 5 per cent of our sales. While we do not foresee any immediate price changes in the near term, the FTA could create opportunities to introduce new and niche products and, if demand scales, support deeper localisation over time. We will closely evaluate the detailed implementation roadmap, timelines and qualification criteria once the fine print of the agreement is available,” Brar explained.