IN BREVE
- Tariffs imposed by the United States have restarted negotiations between the EU and India to reduce tariff barriers on agri-food products.
- The agreement provides for a reduction of tariffs on wine from 150% to 20% and the elimination of tariffs on olive oil within five years.
- India represents a significant potential market for Made in Italy food & beverage, with a growing affluent class.
- Italian agri-food exports to India reached €142 million in 2024, but show room for development, especially for wine and olive oil.
- Indian imports are dominated by large commodity producers, while economic growth is opening opportunities for processed products.
It took the tariffs imposed by the United States during the Trump presidency to unlock two trade negotiations launched over twenty years ago: the one between the European Union and Mercosur, currently temporarily frozen, and the one between the EU and India. Two key steps in a historical phase marked by new political and commercial barriers, which make market diversification a strategic necessity for European and Italian businesses.
In the case of India, the agreement aims to significantly reduce tariff and non-tariff barriers that currently limit access for European agri-food products. A central issue for sectors such as wine and olive oil, which have been penalized for years by high tariffs.
REDUCTION OF TARIFFS ON WINE AND OLIVE OIL
With the entry into force of the agreement, tariffs on wine will go from the current 150% to 75%, then gradually decrease to 20%. For olive oil, a complete elimination of tariffs is planned within five years, starting from the current 45%. A significant change of scenario for two sectors that symbolize Made in Italy agri-food. However, agricultural products considered more sensitive remain excluded from liberalization. For the European Union, tariffs will continue to apply on beef, sugar, rice, chicken, powdered milk, and soft wheat, to protect internal markets.
THE POTENTIAL OF THE INDIAN MARKET FOR ITALIAN BUSINESSES
From the perspective of Italian businesses, the opportunities are significant but should be evaluated from a medium to long-term perspective. India is among the most populous countries in the world, but wealth remains highly concentrated. It is estimated that 1% of the population holds about 40% of national wealth. Alongside this elite, however, there is a growing segment composed of families of professionals and entrepreneurs with annual incomes exceeding €40,000, which surpasses 60 million people.
This “affluent class” represents the natural target for Made in Italy food & beverage. Estimates indicate it could double in a few years, structurally expanding demand for quality imported products.
TRADE BALANCE STILL UNFAVORABLE TO ITALY
Agri-food trade between Italy and India today remains unbalanced in favor of New Delhi. The balance exceeds €450 million, with Italian imports concentrated on coffee, tea, spices, frozen fish and shellfish, and rice.
Italian agri-food exports to India reached €142 million in 2024 and grew by over 7% in the cumulative January-November 2025 period. Exports are dominated by chocolate, coffee, fruit, and plants, which together represent 63% of the total. Wine and olive oil remain marginal, with a combined share of 5%, while including pasta, cheeses, and tomato derivatives does not reach 20%. A figure that highlights ample room for development, also linked to the reduction of customs barriers.
CONSUMPTION STILL LIMITED, BUT GROWING
“Concrete growth opportunities, which however need to be won and above all cultivated in light of the fact that, especially for wine and olive oil, these are products whose consumption is moving in parallel with the economic and income growth of the local population and, therefore, with changes in lifestyles: just consider that currently wine consumption does not exceed 250,000 hectoliters (in Italy we consume 90 times as much) and imports cover less than a third of that quantity,” notes Denis Pantini, Head of Agri-food at Nomisma.
Today, Indian agri-food imports exceed €33 billion and are dominated by large commodity producers such as Brazil, Argentina, Indonesia, Russia, Malaysia, and the United States, which cover about half of purchases. 75% of the value concerns vegetable oils, fruit, and legumes. India has the largest agricultural area in the world for arable land and is self-sufficient in rice, milk, and sugar, but remains deficient in fats and vegetable proteins. Imports are therefore still oriented toward agricultural raw materials, although economic growth is progressively opening spaces for processed food & beverage products.
