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India plans sharp cut in car import tariffs under proposed EU trade pact

India is planning a sharp reduction in car import tariffs as part of a proposed free trade agreement with the European Union, potentially opening up its auto market to European brands.

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India is planning a significant reduction in import tariffs on cars from the European Union as part of a proposed free trade agreement, according to sources familiar with the discussions. The move could mark the biggest opening yet of India’s tightly protected automobile market.

Under the plan, import duties on a limited number of cars priced above 15,000 euros are set to be reduced to 40% from the current levels that go as high as 110%. Over time, these duties could be lowered further to 10%, the sources said.

The decision is expected to benefit European automakers including Volkswagen, Renault and Stellantis, along with luxury manufacturers Mercedes-Benz and BMW, which have long raised concerns over high import taxes in India.

Trade pact announcement expected soon

India and the European Union are expected to announce the conclusion of negotiations for the long-pending free trade agreement as early as Tuesday. The pact has already been described by officials as a landmark deal, with final details to be worked out and ratified subsequently.

The agreement could significantly expand bilateral trade and provide relief to Indian exporters of products such as textiles and jewellery, which have been impacted by steep tariffs in recent months.

Limited quota, phased reduction

Sources indicated that India has proposed an immediate tariff cut for around 200,000 combustion-engine cars annually. While the quota could still see last-minute changes, it represents the most aggressive step yet by New Delhi to open up its auto sector.

Battery electric vehicles will not be included in the duty reductions for the first five years. This exemption is aimed at safeguarding investments made by domestic manufacturers such as Tata Motors and Mahindra & Mahindra in the developing EV segment. After the five-year period, EVs are expected to follow a similar tariff-cut path.

European brands see growth opportunity

India is currently the world’s third-largest car market after the United States and China, with annual sales of about 4.4 million units. However, European carmakers hold less than a 4% share of the market, which is dominated by Japanese and Indian manufacturers.

Lower import taxes could allow global brands to introduce a wider range of models at more competitive prices and assess consumer demand before committing to additional local manufacturing.

With the Indian car market projected to grow to 6 million units annually by 2030, several European automakers are already planning new investments, seeing India as a key growth destination beyond their traditional markets.

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Latest world news

Bangladesh’s BNP seeks stronger India ties based on mutual respect

Bangladesh’s new BNP-led government has signalled a diplomatic reset with India, emphasising mutual respect, trade and broader people-to-people engagement.

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Tarique Rehman

The newly elected government in Bangladesh, led by Tarique Rahman and the Bangladesh Nationalist Party (BNP), has expressed its intent to strengthen ties with India through mutual respect, trade and deeper people-to-people engagement.

Humayun Kabir, who oversees international relations for Rahman and is expected to play a key role in the new administration, said the focus will be on building stronger cooperation between citizens of both countries rather than limiting ties to official exchanges.

He indicated that India would be among the countries the new leadership plans to visit, though no specific timeline was shared. “Obviously there are certain domestic priorities and then international engagements. Of course India will be one of the countries that we will visit among other countries in the region,” Kabir said in an interaction with media.

Expanding engagement beyond official visits

Kabir underlined the importance of expanding the scope of bilateral relations beyond high-level diplomatic visits. While acknowledging that reciprocal visits between senior officials are a normal feature of ties between neighbouring nations, he stressed the need to widen engagement across broader sections of society.

He said the BNP-led government intends to deepen cooperation through trade and investment while strengthening grassroots-level connections.

On regional balance and Pakistan ties

Responding to questions about Bangladesh’s approach towards Pakistan during the interim administration led by Muhammad Yunus, Kabir said Dhaka’s foreign policy would not be guided by choosing sides in regional tensions.

“It’s normal and we need to normalise relations in the region and regardless of the tensions between India and Pakistan, for us it is not to take sides on this issue,” he said, adding that relations would be shaped by mutual respect and national interest.

Kabir also criticised former prime minister Sheikh Hasina, alleging that her foreign policy approach was perceived as one-sided in its engagement with India. He said the new government seeks to avoid what he described as a country-centric or country-dependent model of diplomacy.

New Delhi’s cautious optimism

From India’s perspective, the decisive electoral outcome in Bangladesh, which delivered a landslide to the BNP, marks the end of the interim phase and opens the possibility of a diplomatic reset.

Indian officials are said to be cautiously optimistic about engaging with Rahman’s leadership. While acknowledging past differences with BNP governments, New Delhi believes the new administration may adopt a pragmatic approach shaped by economic priorities and regional stability concerns.

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Finland PM Petteri Orpo to attend India AI Impact Summit, meet PM Modi

Finland Prime Minister Petteri Orpo will visit India from February 17 to 20 to attend the AI Impact Summit and hold bilateral talks with PM Narendra Modi.

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Petteri Orpo will travel to India from February 17 to 20 to participate in the India AI Impact Summit and hold bilateral discussions with Narendra Modi.

Prime Minister Orpo is scheduled to meet PM Modi on February 18. He will also attend the India AI Impact Summit on February 19, which is being hosted in New Delhi.

The Finnish Prime Minister is accompanied by a business delegation comprising representatives of 22 Finnish companies. According to an official release, the visit aims to strengthen cooperation between the two countries, particularly in digitalisation and sustainability.

Focus on AI governance and innovation

The India AI Impact Summit, being held from February 16 to 20 at Bharat Mandapam, will bring together Heads of State and Government, international organisations, AI experts and leading companies from across the globe.

The summit is designed to promote a shared understanding of global AI governance principles and foster international cooperation. Prime Minister Orpo had also taken part in the AI Action Summit in Paris in 2025.

“At the summit, we will highlight Finland’s strengths in the fields of AI policy and innovation. Finland has world-class expertise in AI and the potential to lead the way in its use. At the same time, we will also promote the safe and responsible use of AI,” Orpo said, according to the release.

He noted that geopolitical and economic competition is intensifying, underlining the need for Finland to remain active in global technology discussions. He also emphasised cooperation with like-minded countries while seeking broader international consensus.

During the summit, Orpo will deliver Finland’s national address, visit country pavilions and participate in side events organised by the Finnish Innovation Fund Sitra and National Association of Software and Service Companies. The programme also includes a dinner hosted by PM Modi and other high-level engagements.

Strategic partnership and trade opportunities

The release highlighted India’s growing global role and described bilateral ties as strong and expanding. The inauguration of Finland’s new Consulate General in Mumbai in 2022 was cited as a significant step in strengthening engagement.

Orpo said Finland aims to deepen cooperation with India in the areas of digitalisation and sustainability, reinforcing the new strategic partnership between the two nations.

He also referred to the conclusion of negotiations on the EU-India Free Trade Agreement on January 27, 2026. Talks on the agreement had been underway since 2007, with some interruptions. The pact is expected to improve access for European companies to India’s expanding market and enhance the broader EU-India partnership.

Summit structure and agenda

The India AI Impact Summit will revolve around three pillars — People, Planet and Progress. Discussions will focus on employment and skilling, sustainable and energy-efficient AI, and economic as well as social development.

Seven thematic working groups, co-chaired by representatives from the Global North and Global South, will present deliverables such as proposals for AI Commons, trusted AI tools, shared compute infrastructure and sector-specific AI use case compendiums.

The event will also address AI safety, governance, ethical use, data protection and India’s approach to sovereign AI, including the development of indigenous foundation models for strategic sectors.

An AI Impact Expo will showcase practical AI applications in healthcare, agriculture, education, climate action, energy efficiency and accessibility. The summit will further spotlight national skilling initiatives, including “Yuva AI for All”, a free course aimed at building basic AI awareness among students and professionals.

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Tarique Rahman-led BNP set for landslide win in Bangladesh elections

BNP led by Tarique Rahman has crossed the majority mark in Bangladesh’s national elections, with projections suggesting a two-thirds majority. Jamaat has conceded defeat.

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Tariq Rehman

The Bangladesh Nationalist Party (BNP), led by Tarique Rahman, is heading towards a decisive victory in Bangladesh’s national elections, with projections indicating a clear parliamentary majority.

Early media projections at 8:00 am local time suggested that the BNP had comfortably crossed the 150-seat mark required to form the government in the 300-member parliament. One projection placed the party at 212 seats, putting it well on course for a two-thirds majority.

The BNP has already declared that it is prepared to form the next government after securing what it described as a majority mandate from voters.

Meanwhile, the Islamist-led alliance headed by Shafiqur Rahman of Jamaat-e-Islami was projected to win 70 seats. Although a significant improvement compared to its previous performance, the tally fell short of its expectations. Shafiqur Rahman conceded defeat and said his party would avoid confrontational opposition politics, adding that it would engage in “positive politics.”

Final results awaited, US extends congratulations

The Election Commission is yet to announce the final results for 299 constituencies where voting took place. An additional 50 seats reserved for women will be allocated based on party lists.

Even before the official declaration, the United States embassy in Dhaka congratulated Tarique Rahman and the BNP, describing the outcome as a “historic victory.”

Political transition under way

Bangladesh’s interim leader Muhammad Yunus is expected to step down once the new government assumes office. The Nobel Peace Prize winner has led the country since the ouster of Sheikh Hasina in August 2024 following a mass student-led uprising.

Yunus’s administration had barred the Awami League from contesting the elections by suspending its registration.

This election marked the first in decades without the participation of two dominant political figures — Sheikh Hasina and former prime minister Khaleda Zia, who passed away in December last year.

After nearly 17 years in exile, Tarique Rahman, 60, returned to Bangladesh following his mother Khaleda Zia’s death and quickly emerged as the frontrunner for the prime minister’s post.

Referendum on reforms held alongside polls

Voters also participated in a referendum on the July National Charter, a reform package negotiated by the Yunus-led interim administration and multiple political parties. The proposals include limiting prime ministers to two terms, forming an upper house of parliament, and restoring a caretaker government system to oversee elections for 90 days to ensure neutrality.

Sheikh Hasina criticised the election process, calling it “deceptive” and alleging low voter turnout. In a statement, she demanded cancellation of what she described as an “illegal and unconstitutional election” and sought Yunus’s resignation.

India watching developments closely

India is closely monitoring the situation due to its strategic and diplomatic interests in the region. Following recent political shifts in Dhaka and concerns over minority safety, New Delhi has emphasised that it will assess the mandate once results are officially declared.

When asked about the polls, MEA spokesperson Randhir Jaiswal said India would wait for the final outcome before commenting further.

With final results expected soon, Bangladesh appears set for a major political transition, with the BNP poised to return to power in a significant comeback.

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