EU GSP Suspension to Hit $66 Billion Indian Exports for a Year Before FTA Relief

• The EU has expanded and extended the suspension of Generalised Scheme of Preferences (GSP) benefits, impacting $66 billion (87%) of Indian exports.
• Indian goods will face higher tariffs in the EU for at least a year, until a Free Trade Agreement (FTA) is implemented.
• The increased tariffs, effective this month, exacerbate challenges for Indian exporters already facing high American duties.
• The India-EU FTA, anticipated to be announced on January 27, could restore preferential access but requires a lengthy ratification process.
• Sectors like textiles, chemicals, metals, and machinery will be significantly affected, with an estimated 20% tariff advantage lost.

Why It Matters: EU's GSP suspension will impose higher tariffs on most Indian exports for a year, pending FTA implementation.