Italy signals deeper trade push into India as EU FTA talks near final stage

As India enters the final leg of concluding its trade agreement with the European Union (EU), Italy, a key constituent of the bloc, on Thursday signalled a stronger commercial push into India, with a target of €700 billion exports by 2027. Deputy prime minister Antonio Tajani, who is on his India visit, said his country sees significant opportunity in India and wants to deepen cooperation in innovation, research and education to improve the competitiveness of both economies.

Speaking at the Italy-India Business Forum in Mumbai, Tajani said that Italian companies already present in India plan to expand operations in sectors such as automotive, sports goods, defence, pharmaceuticals and space, adding Italy wants to encourage two-way investments as part of a broader strategic partnership.

At the event, commerce and industry minister Piyush Goyal said that the accelerating engagement, including three major business interactions in eight months, reflects a shift in how both sides view the partnership. Goyal said India is committed to concluding the long-pending EU-India free trade agreement (FTA) and wants a fair and balanced outcome, arguing that a modern FTA would give businesses on both sides a predictable framework for trade and market access. Goyal said that the negotiations are now at a stage where political will can determine the final outcome, and suggested the deal could be brought “over the finishing line” with sustained effort.

According to Italy’s Economic Diplomacy data, there are over 800 Italian companies in India, employing around 60,000 people, with a combined turnover of €9.7 billion. Their presence ranges from fully owned subsidiaries to joint ventures and commercial offices, concentrated largely in the Delhi-Gurgaon-Noida, Mumbai-Pune, Chennai and Bengaluru industrial hubs.

In 2024, the stock of Italian foreign direct investment in India reached €6.9 billion, while Indian investment in Italy stood at €490 million. These companies operate across automotive and components, engineering machinery, food and beverages, fashion, retail and energy, reflecting the depth and diversity of Italy’s engagement in India.

Several major Italian firms have an established presence in the country, including Fiat and Piaggio in automobiles and mobility; Ferrero and Lavazza in food and beverages; and Benetton and Geox in fashion retail. Engineering and component makers such as Carraro, Graziano, Brembo, Dell’Orto and Raicam run manufacturing and R&D units serving domestic and export markets. Italian machinery companies including IMA and Ansaldo Caldaie are active in industrial equipment, while brands such as OVS continue expanding their retail footprint.

Tajani’s remarks come at a time when Europe is diversifying supply chains and seeking more reliable partners amid continuing geopolitical uncertainty. For European manufacturers looking to reduce dependence on China, India is emerging as one of the most critical alternatives, offering both scale and a widening industrial base. Tajani said Italy wants to be part of India’s innovation strategy and sees technology-driven collaboration as the next step in the relationship.

Goyal highlighted the Italy-India Joint Strategic Action Plan, which is being implemented across trade, investment, research, innovation and people-to-people exchanges. He said auto components, textiles and leather goods are areas where both countries can expand industrial collaboration, while Indian firms are exploring partnerships in R&D, sports technologies, defence, space and agri-processing. With India preparing to host the 2030 Commonwealth Games and considering a bid for the 2036 Olympics, he said that sports manufacturing and infrastructure have become areas of growing interest for Italian companies specializing in high-performance equipment.

Speaking on the broader trade architecture, Goyal said that the India-Middle East-Europe Economic Corridor will make movement of goods faster and more predictable, but added that countries must also address input costs and supply-chain vulnerabilities. He warned against over-reliance on any single geography at a time when trade is increasingly being “weaponized”, and said economies committed to open markets must work together and explore mutual recognition agreements to support their industries.

In June this year, Goyal visited Italy for a two-day trip from 4–5 June, during which he co-chaired the 22nd Session of the India–Italy Joint Commission for Economic Cooperation (JCEC) with deputy prime minister Antonio Tajani.

India’s exports to Italy in FY25 stood at $7.72 billion against imports of $6 billion, narrowing the trade surplus from the previous year when exports were $8.76 billion and imports $5.79 billion.

India’s key exports to Italy include electrical and electronic equipment, iron and steel products, machinery, organic chemicals, coffee, tea, spices, vehicles and a range of metal articles. India imports mainly machinery and electrical equipment from Italy, along with machine tools, industrial systems, chemical products and specialized engineering items that support domestic manufacturing sectors such as textiles, automotive and heavy industry.