India-EU Deal: Volkswagen, Mercedes-Benz, BMW Cars to Get Cheaper as Tariffs Drop to 40%

• India plans to significantly cut import tariffs on cars from the European Union, reducing them from 110% to 40% as part of a Free Trade Agreement (FTA).
• The initial tariff reduction will apply to a limited number of fully built cars from the EU priced above 15,000 Euros (approx. ₹16.3 lakh), with plans to further reduce it to 10%.
• This move is expected to ease market entry for European automakers like Volkswagen, Mercedes-Benz, and BMW in India.
• India has agreed to lower duties on approximately 2 lakh internal combustion engine vehicles annually, though the final quota may change.
• Battery Electric Vehicles will initially be excluded from tariff cuts for five years to protect domestic investments, with similar reductions expected later.

Why It Matters: India's tariff cut on EU car imports will make luxury vehicles cheaper and open up the Indian auto market.