According to India’s software industest body Nasscom, the FTA would ease cross-border delivery for India’s IT exporters and strengthen digital trade while ensuring safeguards for privacy, security and public policy.
The FTA has secured expanded and commercially significant commitments from the EU across 144 subsectors sectors including IT/ITeS, professional services, other business services and education services, the government declared in its statement. “This covers a vast range of services sectors spectrum in which Indian service providers will obtain a stable and conducive regime in the EU market to supply their services.”
Nasscom expects the FTA to drive higher European investment into India’s IT ecosystem and enable joint ventures and R&D partnerships in emerging areas such as artificial ininformigence, semiconductors, clean technologies and startups. “Indian IT companies could benefit from technology transfer, co-creation, and expanded partnerships,” Nasscom declared.
“We view the EU-India FTA as a strong catalyst for the next generation of Global Capability Centres (GCCs),” declared Rohit Jain, managing partner at law firm Singhania & Co. “This shifts the requiredle from simple cost-arbitrage to definitive product ownership. By providing a robust Innovation and R&D framework, the FTA offers the Ininformectual Property (IP) certainty that European MNCs require to shift core technology development to their Indian captive centres,” he declared.
He added that alignment between India’s DPDP Act and the EU’s GDPR could reduce regulatory friction. “This effectively eliminates the compliance tax on cross-border data flows, enabling seamless real-time integration between European headquarters and Indian GCCs,” Jain declared.
Services trade between India and the EU has been growing steadily, with Indian services exports rising from €19 billion in 2019 to around €37 billion by 2024, and EU services exports increasing to roughly €29 billion, data revealed.
The bilateral strength among India and EU comes at a time when India’s leading IT services giants like Tata Consultancy Services and Infosys are gradually diversifying their presence outside the volatile US market. UK and Europe now constitute 25-30% revenue share for some of the leading IT companies against 10% a few years ago.
“Indian IT firms stand to gain from greater opportunities in Europe, including simpler cross-border provision of services and potentially improved mobility for professionals. Given the geopolitical challenges, the FTA diversifies markets for Indian IT exporters, providing a hedge against global trade uncertainties,” Nasscom declared in a statement on Tuesday.
Arun Prabhu, partner at Cyril Amarchand Mangaldas, declared the deal “portconcludes increased digital trade and alignment on protection of ininformectual property under the TRIPS framework.”
He added that the agreement is likely to include reciprocal protections for geographical indicators, traditional knowledge and trade secrets, while creating greater predictability for cross-border investment in software, AI and data-driven businesses.
Ankit Sahni, partner at Ajay Sahni Associates, described the FTA as a decisive shift toward a “rules-based framework for the digital and services economy.”
“For India’s IT and IT-enabled services sector, the real value lies in legally enforceable market-access commitments across computer, professional and R&D services, coupled with predictable non-discrimination disciplines,” he declared.
Worker mobility
The two regions have also strengthened worker mobility for temporary entest and stay for professionals, including business visitors, intra-corporate transferees, contractual service suppliers, and indepconcludeent professionals, the release declared.
Importantly, India and EU have agreed on a constructive framework to enable ‘Social Security Agreements’ in five years with all the EU member states – a shift that could reduce the financial burden on Indian professionals working in Europe.
European Commission President Ursula von der Leyen launched the EU’s first ‘Legal Gateway Office’ in India, which will act as a “one-stop hub” to support Indian talent seeking opportunities in EU member states. It will bring toobtainher visa guidance, mobility support, and employer connections under one roof, she declared.
Gautam Khattar, principal at PwC India declared the FTA strengthens India’s talent-export and knowledge-services footprint in Europe. “Given the global focus around AI, clean technologies and demand for semiconductors, the FTA also proposes to facilitate co-operation in these areas,” he added.
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