EU - India free trade agreement: What it means for polymers, plastics and Türkiye

After nearly two decades of intermittent negotiations, the European Union and India have finally reached a political agreement on a comprehensive free trade agreement (FTA) on January 27, 2026. Chemicals and plastics are explicitly covered within the scope of this agreement by both parties, although HS-level tariff details for polymers, plastics and downstream manufacturing have yet to be disclosed.

In the meantime, Türkiye - which is linked to the EU through a Customs Union but excluded from EU FTAs by default - comes into play as the deal raises renewed questions about competitiveness and asymmetric market access.

What does the EU–India FTA cover?

According to official summaries released by both sides, the agreement will substantially liberalize trade in industrial goods, with a large share of tariffs eliminated at entry into force and the remainder phased out over transition periods. Chemicals and plastics are explicitly listed among the covered sectors, although detailed HS-level tariff schedules and staging for individual polymer products (such as PE, PP or PVC) have yet to be fully disclosed publicly.

The agreement also preserves the right of both parties to apply trade-defence instruments, including anti-dumping, countervailing duties and bilateral safeguards, should import surges threaten domestic industries. This caveat is particularly relevant for polymer markets, where capacity cycles and price volatility are pronounced.

Implications for the EU: Limited upside for resins, rising import pressure downstream

From the EU’s perspective, the FTA offers a potential outlet for European producers at a time when the region’s global share of plastics production has been steadily declining. India will cut high industrial tariffs on European goods, with chemicals having current tariffs of up to 22% largely liberalized at entry into force and most plastics phased in over up to seven years, which will help EU suppliers diversify sales away from a saturated domestic market in theory.

In polymers: However, the upside for EU commodity resin producers appears limited. Although India is the world’s largest PVC buyer and the second PE buyer, the country is simultaneously expanding its own petrochemical and polymer capacities, supported by refinery-linked investments and a strong policy focus on domestic value creation. In other words, India is likely to continue protecting their domestic market amidst coming capacity additions. As a result, EU exports of standard PE, PP and PVC to India are likely to remain niche or opportunistic, rather than structural.

Where the EU may see more tangible benefits is in higher-value polymers, specialty materials and engineered compounds, where European producers retain technological and specification advantages. Still, these gains are unlikely to materially offset the broader competitiveness pressures facing Europe’s polymer sector.

In finished plastics: On the other hand, the FTA could increase import pressure on the EU, particularly in compounds, semi-finished plastics and finished plastic articles originating from India. Even modest incremental volumes could weigh on EU markets already grappling with weak demand, high energy costs and regulatory burdens.

That said, EU’s chances of flooding Indian polymer markets are weak considering the shrinking domestic production amid deepening rationalization and capacity cutbacks through plant closures and lower operating rates. The real pressure will be felt on the downstream chain, where converters/plastics manufacturers may have to face mounting competition in an already fragile market.

Implications for India: Stronger positioning across resins and finished plastics

For India, the agreement is structurally more positive. Preferential access to the EU market enhances India’s ability to scale up exports of both polymer products and finished plastic goods, leveraging cost competitiveness, improving quality consistency and growing production capacity.

In polymers: India is currently a net-importer of PVC, PE and even PP. The country hosts massive domestic capacities, but installed capacities still lag behind the market size and thus, imports are needed to compensate for the deficit. In a bid to reduce dependence on imports, various new projects are underway, as can be followed from ChemOrbis Supply Wizard. Despite these capacity additions, India is still not anticipated to reach self-sufficiency in PVC and PE on the back of the steady demand growth foreseen. On the other hand, ChemOrbis data suggest that PP capacity additions are expected to exceed market size, which means that the country may return to its net-exporter status in the next 5 years.

In this context, PP exports - rather than PE and PVC - may find their way to Europe in the longer run to benefit from tariff preferences, as import dependence is visibly increasing in the European PP market, where capacity rationalization tightens regional supply. Aside from PP, India’s role is likely to expand more in compounds and customized formulations, where supplier switching is easier and buyer qualification requirements are less stringent than for regular resins like PP, PE, PVC.

In finished plastics: The benefits are clearer. Indian producers of packaging, household goods, pipes, fittings and automotive plastic components stand to gain from tariff elimination, especially in price-sensitive segments. The FTA therefore reinforces India’s trajectory from a primarily domestic-focused polymer market toward a more export-oriented plastics manufacturing hub.

What does this mean for Türkiye? Rising risk of losing competitive ground?

For Türkiye, the EU–India FTA revives a familiar structural challenge. As a member of the EU–Türkiye Customs Union for industrial goods, Türkiye must align with the EU’s external tariff regime - yet it does not automatically gain reciprocal access to markets opened by EU FTAs.

Resins: Mixed but asymmetric effects

In polymers, the impact on Türkiye is two-sided. On one hand, if EU producers redirect part of their export focus toward India, this could reduce competitive pressure on nearby markets, including Türkiye. On the other hand, Indian polymer and compound suppliers gaining preferential access to the EU could increasingly compete within the broader EU–Türkiye customs area, indirectly intensifying competition in Türkiye’s own market.

The most exposed segments are likely to be commodity polymers and cost-driven compounds, where small price advantages can quickly shift trade flows.

Finished plastic products: Higher competitive risk

The greater risk for Türkiye lies in finished plastic goods. Turkish converters competing in the EU market may face stronger price competition from Indian suppliers benefiting from tariff preferences and scale advantages. This is particularly relevant for standardized, high-volume plastic products, where differentiation is limited and unit costs dominate purchasing decisions.

At the same time, Indian finished plastic products entering the EU under preferential terms may also find their way into the Turkish market, further tightening margins for domestic producers.

Bottom line

The EU–India FTA marks a long-awaited strategic alignment between two major economic blocs.

• India appears to be emerging as the clearer structural winner in polymers and plastics - if included in the tariff preferential list to be officially revealed soon.


• For the EU, the agreement offers selective opportunities but does little to resolve the deeper competitiveness challenges facing its polymer and plastics industry.


• For Türkiye, the deal underscores - once again - the asymmetric risks embedded in the current Customs Union framework. Without parallel agreements or a modernization of the EU - Türkiye Customs Union, Türkiye risks losing relative competitiveness, particularly in finished plastic products, while bearing the indirect costs of market liberalization it did not negotiate.