India–EU Trade Deal: Good or Bad for West Bengal?

The proposed India–European Union Free Trade Agreement (FTA) is poised to become one of the largest trade agreements in the world, covering nearly 30% of global GDP. While national-level discussions often dominate headlines, the real impact of such a deal will be felt at the state and sectoral levels. For West Bengal, the agreement could open up significant opportunities if leveraged strategically.

West Bengal has a diversified economic base spanning traditional manufacturing, agriculture, MSMEs, and a fast-growing services sector. Many of these align well with European market demand, sustainability priorities, and value-added trade. Here’s a closer look at how the India–EU FTA could shape Bengal’s economic future.

Leather & Leather Goods: A Natural Winner

West Bengal is already the backbone of India’s leather export ecosystem. The state contributes around 50% of India’s leather exports, with 538 tanneries out of 2,020 nationwide operating here. Kolkata, in particular, has earned global recognition for finished leather products, including footwear, bags, and accessories.

Under the proposed FTA, the reduction or elimination of EU import duties on leather goods could significantly enhance competitiveness for Bengal-based exporters. This would directly benefit the Kolkata Leather Complex, along with thousands of small and medium units that depend on export orders for employment and growth.

Textiles, Handlooms & Jute: Sustainability Meets Tradition

Bengal’s textile and handloom sectors, especially those linked to jute and jute-blend products, stand to gain from the EU’s strong focus on sustainability and circular economy practices. With the EU’s Green Deal pushing demand for eco-friendly alternatives, jute bags, furnishings, and textiles from Bengal could find a growing niche market.

Lower tariffs and clearer standards under the FTA could help Bengal’s traditional industries move up the value chain, transforming heritage crafts into globally competitive export products.

IT & ITeS: Expanding Global Footprints

West Bengal’s IT and ITeS sector has quietly emerged as a major growth driver, with software exports crossing ₹40,000 crore over the last decade. Kolkata’s expanding tech ecosystem, supported by new IT parks and skilled talent, positions the state well to benefit from the services component of the FTA.

Any concessions under Mode 4 (movement of professionals) could allow more engineers, consultants, and tech specialists from Bengal to service EU clients directly, strengthening long-term business ties and export revenues.

Gems & Jewellery: Opportunities in Niche Segments

India is a global leader in gems and jewellery exports, and Bengal has a growing presence in crafted and niche jewellery segments. Harmonisation of standards, simplified compliance, and reduced duties under the FTA could stimulate demand from European buyers seeking unique, high-quality designs.

This could encourage more design-led manufacturing and skill development within the state.

Tea & Agricultural Value-Added Products

West Bengal’s agricultural exports could also see meaningful gains. Darjeeling Tea, already protected under Geographical Indication (GI) norms in the EU, stands to benefit from stronger enforcement and wider market access.

In addition, products like Malda mangoes and marine exports such as black tiger prawns could tap into EU demand if producers meet stringent quality, traceability, and sustainability standards. The FTA could provide the regulatory clarity and tariff support needed to scale these exports.

The Road Ahead for Bengal

While the India–EU FTA presents clear opportunities, real benefits will depend on state-level preparedness, from improving compliance infrastructure and skill development to supporting MSMEs with finance and market access.

If leveraged strategically, the agreement could act as a catalyst for export-led growth, job creation, and global integration for West Bengal. For a state with deep industrial roots and emerging modern sectors, the India–EU trade deal could mark a defining moment in its economic journey.