India’s long-term growth outlook and reform-led policy framework are reinforcing global investor confidence, with the proposed India–European Union Free Trade Agreement (FTA) seen as a catalyst for deeper trade and technology ties, according to Hardeep Brar, President and CEO, BMW Group India.
“India today is not just a large market, but a future-ready economy backed by reforms and policies focused on building a globally competitive ecosystem,” Brar said, adding that the India–EU FTA could be a historic milestone as it will expand bilateral trade and enable a stronger exchange of technology and innovation.
Brar argues for balanced provisions
From an automotive industry perspective, Brar added that the upcoming agreement must include balanced provisions that stimulate demand while strengthening supply-chain integration which has become an increasingly critical priority amid geopolitical uncertainty that often leads to global trade disruptions.
“The auto sector is deeply globalised, and supply-chain resilience has become a strategic necessity. Any framework that supports smoother movement of technology and components while enabling local manufacturing will benefit India,” he said.
Brar pointed out that a calibrated reduction in customs duties on completely built units (CBUs), if included under the FTA, could help unlock demand in India’s underpenetrated luxury car segment. Luxury vehicles account for only about 1% of India’s passenger vehicle market, limiting choice despite rising aspirations and income levels.
Brar on luxury car market
“If customs duties on CBUs are rationalised, it would help expand the luxury car market,” Brar said. “Currently, CBUs contribute around 5% of our sales. A supportive duty framework would allow manufacturers to broaden portfolios, introduce globally popular models and test new offerings in India.”
He stressed that such a move would not undermine mass-market players or domestic manufacturing, given the small size of the luxury segment. Instead, it could act as a bridge toward deeper localisation if volumes scale up over time.
“As demand builds and market viability improves, it can support higher levels of localisation, including local assembly and sourcing,” Brar said, calling it “a genuine win-win for consumers, industry and policymakers.”