SRINAGAR: Smiles have returned to Kashmiri handicrafts artisans and exporters after tariffs on labour-intensive sectors were brought down to zero under the India–European Union Free Trade Agreement (FTA).
According to the Union Commerce Ministry, the India–EU FTA gives a decisive boost to its labour-intensive sectors such as textiles, apparel, leather, footwear, marine products, gems and jewellery, handicrafts, engineering goods, and automobiles, bringing down tariffs up to 10% on almost USD 33 billion of exports to zero.
Beyond enhancing competitiveness, it empowers workers, artisans, women, youth, and MSMEs, while integrating Indian businesses more deeply into global value chains and reinforcing India’s role as a key player and supplier in global trade.
“The India-EU FTA will give a significant boost to our handicrafts sector. Most of our handicrafts, including carpets and Pashmina, are exported to Europe. Earlier, we had to pay 10 percent duty. Now it has been reduced to zero. It will push our exports,” Javid Ahmad Tenga, president, Kashmir Chamber of Commerce and Industry, told The Kashmir Monitor.
What has brought cheers to Kashmir Inc is that the deal has ensured free market access for home décor, wooden crafts, and furniture. Lower duties of up to 10.5% provides enhanced access, boosting the competitiveness of Indian wooden, bamboo, and handcrafted furniture.
“Earlier, we had to face trouble in exporting handmade wooden items. Now, we will have easy access to EU markets, which will help in generating jobs and income in Kashmir,” said Tenga.
Carpet Export Promotion Council (CEPC) has welcomed the historic conclusion of the India–European Union Free Trade Agreement (FTA) as a breakthrough moment for India’s traditional exports — especially the handmade carpet and rug industry — which stands poised to leverage preferential access to one of the world’s largest consumer markets.
India–EU FTA broadens market access for over 99 per cent of Indian exports by value, and provides duty-free or preferential entry across almost all tariff lines in the EU. The agreement specifically highlights benefits for labour-intensive sectors, including Handmade Carpets/Rugs and Handicrafts, textile products — creating a fertile landscape for enhanced export performance.
“With preferential market access under the India–EU FTA, the handmade carpet industry can now look forward to enhanced export prospects, improved price realization, and deeper engagement with European buyers. This will reinforce India’s position as a trusted supplier of high-quality, handcrafted rugs and carpets and as a partner of choice for sustainable and ethical sourcing,” said Aslam Mahboob, Vice Chairman, CEPC.
Official figures reveal that hand-made products worth ₹309.62 crore were exported to various overseas destinations in Q1FY26, up from ₹126.90 crore in the previous quarter. The second quarter, from July to September 2025, contributed over Rs 100 crore, bringing the H1FY26 total to Rs 410 crore. The Handicrafts and Handloom Department is targeting exports of over ₹1500 crore in the current fiscal. Last fiscal, craft products worth ₹733.59 crore were exported.