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India’s exports of goods and services to Germany could exceed $50 billion by 2030, supported by growing economic complementarities, the India-European Union Free Trade Agreement (FTA) and deeper industrial cooperation, according to a report by the Associated Chambers of Commerce and Industry of India (ASSOCHAM).
Bilateral merchandise trade between India and Germany reached $31 billion in FY26, marking an increase of about 41% from FY18, the report said. India’s exports to Germany grew 8.44% to $11.5 billion in FY26, led by automotive parts, electrical components, pharmaceuticals and textiles.
Trade in services between the two countries stood at $16.76 billion, with Indian exports accounting for the larger share, according to the report. Germany is India’s largest trading partner in the European Union.
The report said the partnership between the two countries is gaining momentum as India offers a growing market and talent pool, while Germany brings technology, capital goods and industrial expertise.
FTA to support export opportunities
The India-EU FTA is expected to create opportunities for Indian exporters by improving market access in Germany and other European markets. According to the report, the agreement, concluded on January 27, 2026, will reduce or remove tariffs on more than 99% of Indian goods entering the EU over time, while progressively opening India’s market to European goods.
Textiles, leather, gems and jewellery, marine products, engineering goods, chemicals, pharmaceuticals and electronics are among the sectors identified as potential beneficiaries of improved price competitiveness in Germany.
The report also highlighted opportunities for Indian industry to access advanced machinery and components from Europe as trade and industrial cooperation deepen.
German investment and industrial cooperation
More than 2,000 German companies operate in India, with cumulative foreign direct investment of about $15.84 billion across engineering, automotive, services and chemicals, the report said.
Initiatives such as Make in India Mittelstand are bringing German technology and Indian manufacturing closer together. Notably, to increase familiarity with India’s evolving investment climate and provide hand-holding support to German Mittelstand companies entering India, in 2015, the Embassy of India in Berlin introduced a targeted initiative: Make in India Mittelstand (MIIM).
ASSOCHAM identified defence and aerospace, semiconductors and electronics, critical minerals, green hydrogen, renewable energy and storage, automotive and green mobility, pharmaceuticals and biotechnology, IT and artificial intelligence, shipbuilding, urban infrastructure, and education and skilling as promising areas for further cooperation.
The report said Indian exports to Germany are gaining ground in electrical plant components, automotive parts, pharmaceuticals, agricultural inputs and specialised textiles, with several product categories recording double-digit growth.
India accounts for 3.5% of Germany’s imports of organic chemicals and has a significant presence in iron and steel articles and pharmaceuticals, according to the report. Germany imports hundreds of billions of dollars’ worth of electrical machinery, machinery and vehicles annually, offering potential opportunities for Indian exporters to expand their market share.
Technology, green energy and defence ties
Technology is emerging as another pillar of the India-Germany partnership, with cooperation spanning semiconductors, batteries, bioeconomy, space and higher education. The report cited Infineon’s Global Capability Centre in GIFT City, the Indo-German Science and Technology Centre and the Higher Education Roadmap as examples of collaboration linking Indian talent with German research and industry.
The January 2026 visit of German Chancellor Friedrich Merz resulted in 19 agreements and memorandums of understanding across 10 areas, according to the report. Key initiatives included the Defence Industrial Cooperation Roadmap, a partnership on the semiconductor ecosystem, a joint declaration on critical minerals, the Digital Dialogue 2026-27 and Global Skill Partnerships for talent mobility.
Germany’s €10 billion Green and Sustainable Development Partnership, alongside an additional €1.24 billion announced in 2026, is supporting cooperation in renewable energy, green hydrogen, electric mobility and urban infrastructure, the report said.
Defence ties are also moving towards co-development and co-production, supported by faster export clearances, joint exercises and a new Indo-Pacific consultation mechanism. The report said these developments could create opportunities for Indian micro, small and medium enterprises to participate in German defence and aerospace supply chains.
Report found that the combination of trade opportunities, investment and industrial cooperation could help Indian businesses, particularly MSMEs, deepen their participation in German and wider European markets.
Also Read: US telecom operators wobble after report SpaceX in talks for cell sites
Bilateral merchandise trade between India and Germany reached $31 billion in FY26, marking an increase of about 41% from FY18, the report said. India’s exports to Germany grew 8.44% to $11.5 billion in FY26, led by automotive parts, electrical components, pharmaceuticals and textiles.
Trade in services between the two countries stood at $16.76 billion, with Indian exports accounting for the larger share, according to the report. Germany is India’s largest trading partner in the European Union.
The report said the partnership between the two countries is gaining momentum as India offers a growing market and talent pool, while Germany brings technology, capital goods and industrial expertise.
FTA to support export opportunities
The India-EU FTA is expected to create opportunities for Indian exporters by improving market access in Germany and other European markets. According to the report, the agreement, concluded on January 27, 2026, will reduce or remove tariffs on more than 99% of Indian goods entering the EU over time, while progressively opening India’s market to European goods.
Textiles, leather, gems and jewellery, marine products, engineering goods, chemicals, pharmaceuticals and electronics are among the sectors identified as potential beneficiaries of improved price competitiveness in Germany.
The report also highlighted opportunities for Indian industry to access advanced machinery and components from Europe as trade and industrial cooperation deepen.
German investment and industrial cooperation
More than 2,000 German companies operate in India, with cumulative foreign direct investment of about $15.84 billion across engineering, automotive, services and chemicals, the report said.
Initiatives such as Make in India Mittelstand are bringing German technology and Indian manufacturing closer together. Notably, to increase familiarity with India’s evolving investment climate and provide hand-holding support to German Mittelstand companies entering India, in 2015, the Embassy of India in Berlin introduced a targeted initiative: Make in India Mittelstand (MIIM).
ASSOCHAM identified defence and aerospace, semiconductors and electronics, critical minerals, green hydrogen, renewable energy and storage, automotive and green mobility, pharmaceuticals and biotechnology, IT and artificial intelligence, shipbuilding, urban infrastructure, and education and skilling as promising areas for further cooperation.
The report said Indian exports to Germany are gaining ground in electrical plant components, automotive parts, pharmaceuticals, agricultural inputs and specialised textiles, with several product categories recording double-digit growth.
India accounts for 3.5% of Germany’s imports of organic chemicals and has a significant presence in iron and steel articles and pharmaceuticals, according to the report. Germany imports hundreds of billions of dollars’ worth of electrical machinery, machinery and vehicles annually, offering potential opportunities for Indian exporters to expand their market share.
Technology, green energy and defence ties
Technology is emerging as another pillar of the India-Germany partnership, with cooperation spanning semiconductors, batteries, bioeconomy, space and higher education. The report cited Infineon’s Global Capability Centre in GIFT City, the Indo-German Science and Technology Centre and the Higher Education Roadmap as examples of collaboration linking Indian talent with German research and industry.
The January 2026 visit of German Chancellor Friedrich Merz resulted in 19 agreements and memorandums of understanding across 10 areas, according to the report. Key initiatives included the Defence Industrial Cooperation Roadmap, a partnership on the semiconductor ecosystem, a joint declaration on critical minerals, the Digital Dialogue 2026-27 and Global Skill Partnerships for talent mobility.
Germany’s €10 billion Green and Sustainable Development Partnership, alongside an additional €1.24 billion announced in 2026, is supporting cooperation in renewable energy, green hydrogen, electric mobility and urban infrastructure, the report said.
Defence ties are also moving towards co-development and co-production, supported by faster export clearances, joint exercises and a new Indo-Pacific consultation mechanism. The report said these developments could create opportunities for Indian micro, small and medium enterprises to participate in German defence and aerospace supply chains.
Report found that the combination of trade opportunities, investment and industrial cooperation could help Indian businesses, particularly MSMEs, deepen their participation in German and wider European markets.
Also Read: US telecom operators wobble after report SpaceX in talks for cell sites
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