India-EU Free Trade Agreement to Enhance Spice Exports with Zero-Duty Access
The recently signed India–European Union Free Trade Agreement (India–EU FTA) is poised to significantly improve market access for Indian spice exporters by providing zero-duty entry into EU markets, according to the Federation of Indian Spice Stakeholders (FISS). This landmark agreement is expected to bolster India's position in one of the world's most quality-conscious markets.
Boost in Competitiveness and Market Predictability
The removal of customs duties of up to 8% on several spice products will enhance the competitiveness of Indian exports, as stated by FISS in an official release. Industry sources anticipate that the FTA will improve trade predictability through progressive tariff liberalisation and closer regulatory cooperation. This development is particularly significant as Indian exporters seek to diversify markets amid higher tariffs in the United States.
The EU remains a major market for Indian spices, driven by robust demand from food processing companies, retail chains, and ethnic food segments. During the 2024–25 fiscal year, India exported 17.99 lakh tonnes of spices and spice products valued at $4.72 billion, marking a notable increase from 15.40 lakh tonnes valued at $4.46 billion in 2023–24.
Persistent Challenges and Compliance Concerns
Despite the optimistic outlook, spice traders have expressed concerns over unresolved uncertainties surrounding the agreement. Compliance with stringent EU food safety and quality norms remains critical. Non-tariff barriers, including border rejections due to regulatory non-compliance, continue to pose a persistent challenge for Indian spice shipments.
U Karthik, co-chairman of FISS, emphasised, "We hope these issues will be addressed through enhanced engagement between Indian authorities and EU regulators under the FTA framework." This highlights the need for ongoing dialogue to ensure smooth trade relations and mitigate potential disruptions.
Impact on Gujarat's Cumin Trade and Farm Incomes
The FTA is expected to particularly benefit cumin traders in Gujarat, which accounts for a dominant share of India's cumin production. The crop is concentrated in districts across north Gujarat and traded extensively through Unjha, the country's largest cumin trading hub.
Any improvement in market access and price realisation is therefore expected to have a direct bearing on:
- Farm incomes in the region
- Market arrivals of cumin
- Overall trade volumes in the state
This positive development could lead to enhanced economic stability for farmers and traders alike, reinforcing Gujarat's pivotal role in India's spice export landscape.
