What is the GSP?

The Standard GSP targets developing countries that are classified by the World Bank as lower or lower-middle income countries and which do not have equal preferential access to the EU market through any other arrangement. Standard GSP beneficiary countries can benefit from duty suspension for non-sensitive products as well as duty reductions for sensitive products across approximately 66% of all EU tariff lines.

Share your thoughts

At a glance: GSP beneficiaries' preferential imports to the EU

group

1.41 billion

Population

account_balance

Federal Parliamentary Republic

Government

trending_up

8,70%

GDP Growth

equalizer

4,60%

Inflation

money

$ 3.18 bn

GDP

Facts about India's economy

Strong Economy

India is the world's fifth largest economy with a nominal GDP of $2.94 trillion. The agrarian origins of India's economy persist in today's economic structure. India is the world's largest producer of a number of agricultural products, including milk, jute and pulses and takes a leading position in the production of rice, wheat, sugarcane, fruit, and cotton.

Export Products

India's most important export goods are medium and light oils, diamonds, and articles of jewellery, machinery, appliances, and vehicles as well as pharmaceuticals and biochemicals.

Trade Partners

The world's largest economies, China, the EU, and the US, are India's most important trading partners. Most of India's imports originate in China, while the US is the most important destination for Indian products.

Economic Structure

About half of India's GDP is accounted for by the services sector (53,89%), more particularly telecommunications, IT, and software. The IT sector is especially important for the Indian economy and contributes about 10% to the GDP. Nonetheless, the majority of the Indian population (43%) still works in the agricultural sector.

Usage of GSP Preferences

India currently makes considerable use of GSP trade preferences and exports about 88.2% of eligible products at reduced rates to the European market.

Trade with the EU

Total trade with the EU amounted to € 87,990 million in 2021. With a share of 11%, the EU, together with the US, is India's most important trading partner.

India and the EU (2022)

Imports from India by product section

Imports from India over time (in € m)

INDIA AND THE EU’s GSP

Economic Impact

34%

About 34% of India's exports to the EU market are eligible for reduced tariffs granted by the Standard GSP.

85%

With 85%, India has the second highest preference utilisation rate among all beneficiaries of the Standard GSP.

Preference utilisation and export diversification

India's imports to the EU

Preference Utilisation vs. total eligible imports

India’s preference utilisation rate was comparatively stable between 2013 and 2022, despite a significant slump in eligible imports from about 22 billion in 2013 to 17 billion in 2014. This can be attributed to the graduation of certain product sections, including for example textiles (S11a), which from then on were no longer eligible for GSP preferences. Between 2020 and 2022 the value of imported products doubled - from 31.8 bn to 65.5 bn - and despite a slight decrease in GSP utilisation rate, in 2022 additional 7 bn-worth imports benefitted from GSP preferences in comparison to 2022 (11.5 bn in 2020 vs 18.8 in 2022).

The largest product sections under the GSP

The majority of products imported from India under GSP preferences make considerable use of the reduced duties. Further potential remains, however, for increasing GSP utilisation in headgear and transport equipment exports as well as in exports of chemical products, including pharmaceuticals, fertilisers and essential oils. Overall, this graph indicates that imports from India under the GSP are relatively well-diversified and India belongs to the GSP countries that trade the largest number of tariff lines.

SUSTAINABLE DEVELOPMENT

India maintains a high level of ratification, despite the preferential market access granted by the Standard GSP is not bound to the ratification of international conventions. India has ratified 12 out of 15 core international conventions on human rights and labour standards. The country is also a signatory to the Convention against Torture and Other Cruel, Inhuman or Degrading Treatment or Punishment. In addition, India has ratified 8 international conventions on environmental protection and 4 conventions on good governance.

Core international conventions on human rights and labour standards

Ratified

Convention on the Prevention and Punishment of the Crime of Genocide (1948)
International Convention on the Elimination of All Forms of Racial Discrimination (1969)
International Covenant on Civil and Political Rights (1976)
International Covenant on Economic Social and Cultural Rights (1976)
Convention on the Elimination of All Forms of Discrimination Against Women (1981)
Convention Against Torture and other Cruel, Inhuman or Degrading Treatment or Punishment (1987)
Convention on the Rights of the Child (1990)
Convention concerning Forced or Compulsory Labour, No 29 (1930)
Convention concerning Equal Remuneration of Men and Women Workers for Work of Equal Value, No 100 (1951)
Convention concerning the Abolition of Forced Labour, No 105 (1957)
Convention concerning Discrimination in Respect of Employment and Occupation, No 111 (1958)
Convention concerning Minimum Age for Admission to Employment, No 138 (1973)
Convention concerning the Prohibition and Immediate Action for the Elimination of the Worst Forms of Child Labour, No 182 (1999)

Not Ratified

Convention concerning Freedom of Association and Protection of the Right to Organise, No 87 (1948)
Convention concerning the Application of the Principles of the Right to Organise and to Bargain Collectively, No 98 (1949)

Additional Conventions

Convention on International Trade in Endangered Species of Wild Fauna and Flora (1973)
Montreal Protocol on Substances that Deplete the Ozone Layer (1987)
Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and Their Disposal (1989)
Convention on Biological Diversity (1992)
The United Nations Framework Convention on Climate Change (1992)
Cartagena Protocol on Biosafety (2000)
Stockholm Convention on persistent Organic Pollutants (2001)
Kyoto Protocol to the United Nations Framework Convention on Climate Change (1998)
United Nations Single Convention on Narcotic Drugs (1961)
United Nations Convention on Psychotropic Substances (1971)
United Nations Convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances (1988)
United Nations Convention against Corruption (2004)

EU-India Bilateral Development Assistance

€ 180 million

The bilateral development assistance to India amounted to €180 million during the period 2014-2020. In light of India's growing energy demand, the EU together with other relevant stakeholders supported the country to enhance and strengthen the supply and usage of renewable energies. Other priority areas included disaster risk management, trade, public finance management, and education.

Opportunities in India

Growing middle-class with a strong propensity to consume
Diverse industrial base
Increasing integration in global supply chains and increasing investments to expand production capacities
High interest in future-oriented technologies, including electric mobility and artificial intelligence

Most recent events

Date	Event

Contact points

Conversations

By submitting a comment I confirm to have read the Terms and Conditions. Users should be aware that if in breach of the Terms and Conditions that their comments, replies and contributions can be removed from the website.