On January 27, European Commission President Ursula von der Leyen and Indian Prime Minister Narendra Modi announced the end of negotiations on an agreement that will eliminate or lower customs barriers and increase trade between, as von der Leyen put it, “the world's two largest democracies” – the EU and the country with its capital in New Delhi. We wrote more about the contract, among others: here.
The rest of the article is below the video:
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“Below potential”
Can Poland also benefit from the agreement? As Patryk Kugiel, chief analyst in the Asia-Pacific Program of the Polish Institute of International Affairs, said in Business Insider Polska, our economic relations with India are not very developed today. However, this does not mean that they do not exist at all – trade is taking place and has the potential to grow.
“India is a promising destination for Polish companies due to the country's economic development in recent years, gradual liberalization and introduced facilitations for entrepreneurs and investors from abroad, as well as the changing business climate,” the Polish Investment and Trade Agency states on the official website.
—Historically, Poland's economic relations with India have for a long time been on a moderate scale and remained below potential, especially in the context of India's cooperation with the largest EU economies – explains Dr. Judyta Latymowicz, an expert on Polish-Indian relations and a partner at the LEGALLY.SMART law firm, in a comment for our editorial office. As he explains, recent years have brought a “gradual development” of mutual relations, but without any strategic direction. The situation is complicated by tariff and non-tariff barriers.
USD 5.8 billion in trade turnover
Dr. Latymowicz explains that signs of increased intensity in economic relations between Poland and India can be seen especially in technological industries, such as IT or ICT services, but also in the machinery and electromechanical sector and in engineering services.
How does it look in numbers? Data from the Central Statistical Office show that in 2024, trade turnover between the two countries amounted to USD 5.8 billion, which was a slightly higher result (by 1.4%) than in the previous year. In 2016, turnover reached approximately USD 2.8 billion, and in the period 2016-2024 it both increased and decreased.
Like the entire European Union, Poland has a trade deficit in its relations with India. Two years ago, exports from the Vistula River to the Ganges amounted to approximately USD 1.44 billion, while the value of imports from India to our country reached USD 4.36 billion. Year on year, exports decreased by 17.7%, while imports increased by 9.8%.
Coke export, diesel import
Let's look at specific goods. It took first place in Polish exports to India in 2024 coke and semi-cokeworth $285.92 million. Later they followed cast iron and steel waste and scrapcorresponding to USD 190.22 million, took third place turbojet enginesworth $150.97 million. Next on the list of top 10 exports to India were synthetic rubber ($71.85 million), albumin ($44.70 million) i ceramic products for laboratory purposes ($36 million). The seventh place belonged to the product of the Polish agri-food sector, i.e fresh apples ($32.05 million), and took the last three positions carbon electrodes ($26.06 million), medical instruments and devices ($22.83 million) and copper waste and scrap ($22.57 million).
But what did we import? Here, in 2024, a lot of space was occupied by products of the Indian electrical machinery and textile industries. Top 10 imports open telephone and telegraphy equipmentworth $302.22 million, which they rank behind diesel oils — $256.30 million. They also made it to the podium medicinesthe import of which from India cost USD 158.94 million. The fourth position is footwear — 121.10 million dollars, the fifth turned out to be t-shirts — $91.70 million. He found himself next tobaccoimported for $82.75 million, and later ceramic products ($82.31 million). Eighth in line footwear covering the ankle was imported for USD 75.83 million, and the next group of products – knitted clothing articles — for $69.07 million. However, they closed the top 10 metal productswith an import value reaching USD 65.70 million.
Indians also had an advantage over Poles when it comes to the value of investments. The National Bank of Poland reports that two years ago, Indian investments in Poland amounted to USD 47.5 million, while Polish investments in India amounted to USD 44 million.
Who will gain and who will lose?
In the context of investments, Dr. Judyta Latymowicz notes that India wants to attract technology industries from Europe and locate part of the production of foreign companies in their country. Technological partnerships are therefore expected to gain in importance and may intensify after the conclusion of the agreement; in the context of potential fields for the development of such partnerships between Poland and India, Dr. Patryk Kugiel mentioned, among others: space industry initiatives.
Dr. Latymowicz points out that Polish companies already present in India or having local partners may turn out to be the greatest beneficiaries of reducing customs duties and limiting non-tariff barriers.
The surprise, however, is who may lose. — The risk concerns some sectors in the EU exposed to cost competition – says the expert. – Therefore, the key will be how effectively protective mechanisms will be implemented and how companies will use new opportunities, remembering that the Indian market requires long-term commitment – he sums up.
