Double Taxation Avoidance Agreement (DTAA): A Comprehensive Guide for NRIs

On 27 January 2026, India and the European Union announced they have concluded a landmark Free Trade Agreement (FTA) after nearly two decades of on and off negotiations. Political leaders on both sides framed it as a historic shift in global trade and a strategic hedge in a turbulent world economy. 

For NRIs, this is not just headline diplomacy. Over the next few years, the deal is designed to change the price and availability of goods, reshape hiring and cross border services, and open fresh lanes for Indian founders and professionals who do business with Europe, source from Europe, export to Europe, or work in sectors linked to EU supply chains.

What happened today, and what still has to happen next

The key point is this: the agreement has been politically concluded, and the broad terms are now public through official statements and media briefings. But the legal text still goes through “legal scrubbing” and then ratification processes before it fully enters into force. Depending on the final legal and parliamentary steps, formal signing and implementation timelines may differ from today’s announcements. 

So, treat this as a major commitment with strong momentum, while remembering that the exact phase in dates, quotas, and compliance rules will matter most once the final schedules are published.

The core deal in one line

India and the EU have agreed to eliminate or reduce tariffs on the vast majority of traded goods over time, with a strong push to make trade simpler through customs and regulatory cooperation. 

The big numbers everyone is quoting

Across multiple reports and official briefings, the most repeated topline is:

• India to eliminate or reduce tariffs on about 96.6 percent of EU goods by value. 

• The EU to phase down tariffs on about 99 to 99.5 percent of Indian goods by value over a multi year period (reported as up to seven years in several briefings). 

• The EU estimates up to €4 billion a year in duty savings for EU exporters once the changes are in place. 

These are aggregate figures, and your real world impact depends on the tariff line, product category, and the exact staging schedule.

What becomes cheaper or more competitive, and why that matters to families and businesses

1) Cars, auto components, and the wider mobility economy

Auto tariffs have been one of the most sensitive chapters. Reports indicate India will cut very high import duties on European cars significantly over time, with figures commonly cited as moving toward 10 percent over a staged period, though interim steps and category conditions are still being reported and debated. 

Why NRIs should care:

• If you support family in India, large purchases like cars may face a reshaped market: more competition, possible price pressure on certain segments, and faster technology inflows.

• If you are in auto, EV, batteries, engineering services, or supply chain tech, this is a real demand signal for cross border partnerships, certifications, and compliance capabilities.

2) Wines and spirits, plus premium European consumer goods

European producers have long pushed for better access in India for wines and spirits. Multiple outlets report meaningful tariff reductions here, staged over time. 

For NRIs, the consumer angle is obvious, but the business angle is bigger:

• hospitality, distribution, retail, compliance, labeling, and cold chain are likely to see new deal flow

• premium food imports can move faster when customs and standards cooperation improves

3) India’s export winners: textiles, gems, chemicals, marine products, pharma

On the India side, several reports highlight easier EU market access for sectors such as textiles, gems and jewelry, chemicals, and marine products, with broader expectations for export growth. 

NRI relevance:

• If your family business exports from India, or you advise one, the EU becomes more attractive if duties fall and procedures simplify.

• If you run a UK or EU based distribution company for Indian products, you may see better unit economics, and better reliability if customs digitisation and facilitation commitments stick.

Services, digital trade, and professional opportunity: the less visible but potentially bigger story

Most people focus on tariffs because they are easy to explain. But for many NRIs, services and mobility provisions can be more material.

Reports and official statements indicate the agreement includes services market access and cooperation, with references to improved access in areas such as financial and maritime services, plus broader facilitation measures. 

Separately, the broader India–EU summit package also emphasised cooperation on technology, innovation, and people to people ties, including mobility frameworks and “one stop” facilitation pilots in at least one sector. 

Practical NRI take:

• If you work in IT, data, cybersecurity, engineering, compliance, supply chain, fintech, or consulting, this deal is likely to accelerate cross border procurement and hiring, because companies invest where trade friction is falling.

• If you are a founder, the opportunity is often not “sell more” but “sell faster” by navigating standards, documentation, and procurement requirements with less friction.

What this means for UK based NRIs

Even post Brexit, this deal can affect UK based NRIs in three concrete ways:

European supply chains still influence UK pricing and availability, especially in autos, electronics, machinery, and specialty goods. If Europe sources more from India, or competes more aggressively in India, prices and supplier strategies can ripple. 

1. Many UK based NRIs operate through EU subsidiaries, EU clients, or EU marketplaces. If your company touches the EU, the India–EU trade environment can reshape your India lane.

2. If you are comparing India opportunities across regions, this deal increases the strategic value of an “India plus EU” go to market plan for founders and professionals.

The watch list: what you should track over the next 90 days

If you do business, invest, or plan career moves around India–EU links, watch these items closely:

• Final legal text and tariff schedules: the staging timeline by product category is where winners and losers become clear. 

• Rules of origin: these decide whether goods qualify for lower tariffs and can reshape sourcing decisions overnight.

• Standards and conformity: EU compliance regimes are detailed, so simplification can be a major cost saver.

• Carbon and climate linked trade measures: reports suggest there is no blanket carve out for EU carbon border measures, but discussions on flexibility and support packages are part of the picture. 

• Ratification calendar: entry into force depends on domestic procedures on both sides. 

Action steps for NRIs and NRI led businesses

If you import into India from Europe

• Re forecast landed cost once tariff staging is clearer

• Renegotiate distributor terms with “future duty path” clauses

• Prepare for higher competition in premium categories

If you export from India to Europe

• Map your HS codes and likely tariff pathway

• Review EU compliance needs early (labels, testing, documentation)

• Consider EU warehousing and local fulfilment to scale faster

If you are a professional or founder

• Align your positioning to the predictable demand spikes: compliance, customs tech, supply chain visibility, procurement, sustainability reporting, quality assurance

• Track which sectors are explicitly highlighted in official and credible briefings, then build content and partnerships around those

Bottom line

Today’s announcement is a major signal: India and the EU are betting on each other for long term growth, supply chain resilience, and strategic autonomy. If the agreement is implemented as outlined, it can reshape trade flows for years. 

For NRIs, the smartest move is to treat this as a blueprint and start preparing now: identify which parts of your life or business touch EU linked supply chains, services, or clients, then plan around the coming tariff schedules and compliance requirements once the final text is released.

Note: This article is general information, not legal, tax, or investment advice. For decisions, take professional advice tailored to your residency, citizenship, and business facts.