In a move that signals a seismic shift in global trade dynamics, the European Union and India today concluded negotiations for a historic and ‘commercially significant’ Free Trade Agreement (FTA). As the largest deal ever brokered by either side, the pact creates a massive free trade zone encompassing 2 billion people and the world's second and fourth largest economies.

While the agreement spans sectors from agriculture to pharmaceuticals, it is the automotive industry that stands as the centrepiece of this industrial realignment.

Cracking the 110% tariff wall

For decades, European automakers have struggled against India’s formidable trade barriers. Under the new agreement, these hurdles are set to crumble. India has committed to a radical reduction in car tariffs, which currently sit at a staggering 110 percent. According to the official release, these duties will be gradually slashed to as low as 10 percent.

Furthermore, the deal provides a massive boost to the automotive supply chain. Tariffs on car parts – a critical sector for European manufacturers – will be fully abolished within a 5-to-10-year window. This move is expected to integrate Indian and European manufacturing hubs more closely than ever before.

European Commission President Ursula von der Leyen hailed the deal as a milestone for rules-based cooperation. "The EU and India make history today. We have sent a signal to the world that rules-based cooperation still delivers great outcomes," she said.

With a population of 1.45 billion and a GDP of EUR 3.4 trillion, India is currently the world’s fastest-growing large economy. This FTA grants European carmakers and industrial firms a ‘privileged access’ that no other Indian trading partner currently enjoys.

Beyond the finished vehicles, the deal addresses the broader industrial ecosystem:

• Machinery & Chemicals: Tariffs of up to 44 percent on machinery and 22 percent on chemicals will be mostly eliminated.
• SME Support: Dedicated contact points will be established to help smaller European component manufacturers navigate the Indian market.
• Intellectual Property: The agreement guarantees high-level protection for designs and trade secrets, providing the legal certainty required for high-tech automotive transfers and R&D investment.

The deal is not merely about volume; it is about the future of mobility. A dedicated chapter on trade and sustainable development focuses on climate change and environmental protection.

To support India’s transition toward sustainable industrialisation – a move critical for the electric vehicle (EV) sector – the EU intends to provide EUR 500 million in support over the next two years. Additionally, a new EU-India platform for climate action cooperation is slated to launch in early 2026, likely serving as a catalyst for joint ventures in green hydrogen and battery technology.

The EU expects the deal to double its goods exports to India by 2032, saving European businesses approximately EUR 4 billion per year in duties.

The path to implementation now moves to the legal and political stage. The negotiated texts will undergo legal revision and translation before being presented to the European Council and the European Parliament for consent. On the Indian side, the agreement will move toward formal ratification.

After nearly two decades of stop-and-start negotiations – beginning in 2007 and relaunching in 2022 – the road is finally clear for a new era of Euro-Indian industrial synergy.

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German material manufacturer Covestro has partnered with automotive major BMW, tier 1 supplier FORVIA HELLA, and academic research institutions to launch KOLLEKT, a project focused on developing recyclable automotive lighting and electronic components.

Funded by the German Federal Ministry for Research, Technology and Space (BMFTR) with EUR 4.371 million under the CircularGlowUp framework, the three-year initiative runs from June 2026 to May 2029.

The consortium led by coordinator FORVIA HELLA, includes BMW, Covestro, Geba, SW Maschinenservice, Fraunhofer IEM, Fraunhofer UMSICHT, the University of Paderborn, Hamm-Lippstadt University of Applied Sciences and the Helmholtz-Zentrum Dresden-Rossendorf. The initiative addresses vehicle recyclability, resource consumption and end-of-life material recovery in light of the EU End-of-Life Vehicles regulation.

The project focuses on product design optimised for repair, reuse, remanufacturing and recycling. Covestro contributes its expertise in polycarbonate materials, including its Makrolon, Bayblend and Apec product lines, to evaluate recycling pathways and material properties from the initial design phase.

Monique Buch, Chief Commercial Officer, Covestro, said, “KOLLEKT is a prime example of how we create value together with our customers and partners — going beyond material supply to co-designing solutions from the very beginning. By aligning early across the value chain with BMW, FORVIA HELLA and other partners, we can embed circularity directly into product development. That is what true co-creation looks like—and how we turn sustainability ambitions into tangible outcomes.”

Technological developments within the project include an artificial intelligence-driven robotic dismantling unit. Utilising digital product twins and real-time data processing, the unit aims to enable automated, material-pure disassembly at an industrial scale.

The initiative builds on the predecessor project NALYSES, which concluded in 2026. Project outcomes are intended to support compliance with EU ELV recycling targets through 2032 and assist vehicle manufacturers in meeting post-consumer recycled content quotas.

Guido Naberfeld, Head of Sales and Market Development Mobility, Covestro, stated, “KOLLEKT is a concrete step toward closing the loop on high-performance polycarbonate in automotive applications. By combining Design for Circularity with advanced recycling technologies and digital traceability, we are demonstrating that sustainability and material performance are not a trade-off. This is how Covestro contributes to meeting the EU's ELV targets and helps the entire automotive value chain transition to a truly circular model.”

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Mumbai-headquartered automotive major Mahindra Group has announced the appointment of Shveta Arya as its new Group Chief Strategy Officer, effective 15 September 2026. Arya will also join the senior management team of Mahindra & Mahindra and serve on the Group Executive Board.

In her new role, Arya will oversee the Group Strategy Office across the organisation's portfolio of businesses to determine growth opportunities and value creation. She will report directly to Dr. Anish Shah, Group CEO & MD of Mahindra Group.

Dr. Anish Shah said, “We are pleased to welcome Shveta Arya as Group Chief Strategy Officer. Shveta brings over two decades of leadership experience across business and strategy, as well as management consulting across diverse sectors. Her experience in driving growth, shaping strategy and leading through change will be valuable as we work with our portfolio of businesses to drive growth and create long-term value across our portfolio of businesses. Her passion for constructive change and holistic progress also resonates strongly with Mahindra’s purpose. I wish her the very best in this key leadership role.”

She comes with over 23 years of experience across publicly listed multinational organisations and management consulting. Her background spans the automotive, travel, financial services and telecom sectors.

Most recently, Arya served as Managing Director of Cummins India, where she managed operations, growth strategy, talent and workplace culture. She was also the program sponsor for Cummins' initiative focused on women and girls in India. Prior to Cummins, she led Strategy and M&A at Thomas Cook India and held roles at Kearney and Infosys.

Arya holds a Master of Business Administration from the Indian Institute of Management Ahmedabad and a Bachelor of Engineering in Information Technology from Delhi University.

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Envalior India Pvt. Ltd. has launched a specialised training hub focused on electric vehicle technology at MM Polytechnic in Pune, marking a significant step in aligning vocational education with the demands of the burgeoning EV sector. The Envalior Centre of Excellence, a product of the company’s CSR initiatives in partnership with the BroadArks Foundation, is intended to serve as a practical workshop where students can transition from theoretical knowledge to applied technical competence.

The facility was formally inaugurated by Christopher Stillings, Vice President –R&D, in the presence of Krijn Dijkstra, Nileshkumar Kukalyekar, Uday Shetty, Susmita Mishra, Hema Rani, Sainath Vaidya and Aniket Nirwan of Envalior, MM Polytechnic leadership and other dignitaries. By embedding this centre within a technical campus, the programme seeks to immerse learners in the realities of EV maintenance and repair, covering not just mechanical functions but also the intricate electrical and software-driven systems that define modern vehicles.

With an annual capacity to reach roughly 250 learners, the centre will cater to students from ITI and polytechnic backgrounds across multiple engineering streams. The coursework is divided into two progressive phases, starting with a foundational module that introduces participants to basic EV architecture, battery safety and routine service procedures. An advanced tier follows, offering deeper instruction on battery management systems, thermal controls, high-voltage safety protocols, motor controllers and complex diagnostic methods.

Beyond traditional lectures, the training environment incorporates interactive lab sessions with real vehicle components, diagnostic tools and industry-relevant projects, ensuring that participants acquire both safety awareness and problem-solving agility. The overarching goal is to produce graduates who are not merely familiar with EV theory but are confident in executing hands-on repairs and system evaluations. Through this scalable framework, Envalior is actively working to narrow the skills gap in India’s automotive sector, creating a direct pipeline of capable talent for the evolving mobility landscape.

Nileshkumar Kukalyekar, Business Director – South Asia, Middle East & Africa, Envalior, said, “The transition to electric mobility is creating a fundamental shift in the skills expected from the automotive workforce. For us, this Centre of Excellence is about ensuring that technical education keeps pace with that change. By giving students the opportunity to work directly with EV systems, understand advanced diagnostics and build capabilities through structured, certified training, we are helping create a stronger bridge between what young technicians learn and what the industry will increasingly expect from them. We see this as an investment not only in individual careers but in the technical talent that will support India’s mobility transition in the years ahead.”

Christophe Stillings, Vice President – R&D, Envalior, said, "At Envalior, we believe the future of mobility depends on developing industry-ready talent today. Through the Centre of Excellence, students will gain hands-on exposure to EV technologies, helping bridge the gap between academic learning and real-world industry requirements. By bringing together academia and industry expertise, we aim to equip the next generation of engineers with the practical skills, confidence and innovation mindset needed to succeed in a rapidly evolving automotive landscape."

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Tier 1 automotive supplier Schaeffler India has appointed Amit Bhalerao as its Chief Operating Officer, effective 10 August 2026.

In his new role, Bhalerao will oversee the company's manufacturing operations across India. His responsibilities include directing manufacturing strategy, operational performance, digitalisation projects and capability development, as well as managing local production initiatives across the firm's plant network.

Bhalerao will join Schaeffler India's Executive Leadership Team, collaborating with divisional heads to manage the company's operational footprint.

Harsha Kadam, Managing Director and CEO, Schaeffler India, said, "India continues to be a strategic growth market for Schaeffler, and strengthening our manufacturing and operations capabilities is central to our journey as the leading Motion Technology Company. Amit brings extensive experience in leading complex manufacturing operations, driving operational excellence and building high-performing teams. His leadership will further enhance our manufacturing competitiveness, customer focus and innovation capabilities as we continue delivering greater value to our customers and stakeholders. We wish Amit the very best and many successes in his journey at Schaeffler in India."

Bhalerao comes with 23 years of management experience in manufacturing, operations, lean transformation, quality assurance and supply chain management. Before joining Schaeffler India, he held the positions of Managing Director and Vice-President of Operations at Kelvion India, where he managed operations, technology transfer and capacity expansion projects. He has also held leadership positions at Cummins, Eaton and Sterlite Technologies.

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