In September, we joined Tacto to discuss the role India plays in European supply chains today. The picture is clear, but one-sided: half of the participants already source from India, while fewer than one in five manufacture there. The most common concern, named by 76 percent, was supplier quality assurance. Our experience with companies already on the ground is different: there, quality is not a reason against India, but a task that can be solved with the right supplier selection, audits and a local presence. The real hurdle is getting started. 

Our takeaways from the discussion: 

The business case has to stand on its own. The EU–India agreement is expected to enter into force in 2027, with significant tariff cuts across many product groups. That improves the numbers, but it does not replace them. A sourcing decision has to work on realistic assumptions about cost, quality and lead times, not on the most favorable scenario imaginable 

Waiting is not a neutral option. Supplier search, audits and stable series production can easily take twelve to eighteen months. Companies that qualify suppliers now will have their supply chain in place when tariffs fall. Those who wait will only just be starting. 

India is not one location but three. As a sourcing market, what matters is supplier quality and total landed cost; as a manufacturing base, infrastructure, legal certainty and access to the domestic market; as an engineering hub, technical talent. Which role fits depends on where a company sits in its value chain and what it needs there. 

Geopolitics is both motivation and risk. 40 percent of participants look to India to reduce their dependence on China – and almost as many, 39 percent, name geopolitical uncertainty as a concern. Both are justified. India does not join camps. It consistently pursues its own interests, with Russia as much as with the West. That does not make it unpredictable, just predictable in a different way: companies that treat India as a partner with its own agenda can plan around it. Those who treat it as a replacement for China or a reliable ally will be disappointed. 

Read Tacto’s full article here (in German) and watch the webinar recording here. How the agreement could become a partnership beyond trade is the subject of our piece in Internationale Politik (in German).