Europe’s rising regulatory burden could give India a cost advantage: Piyush Goyal

The latest market report highlights that Europe risks losing businesses to India as rising regulatory requirements propel up production costs, Commerce and Industry Minister Piyush Goyal stated on Thursday, outlining how India’s growing economic weight is changing the way it negotiates trade agreements.

Speaking at the 13th Public Affairs Forum of India (PAFI) Annual Forum 2026, Goyal stated India was negotiating with the world as a $4 trillion economy, while its economy on a purchasing power parity basis was already around $20 trillion, making it the third largest globally. The country is working towards becoming a $30 trillion economy, he stated.

He stated India’s trade agreements were being structured to secure benefits beyond preferential market access.

“Every one of my agreements, mind you, are fair, equitable and balanced. Everybody has had to add a sweetener, without which we didn’t sign a single FTA,” he stated.

Goyal cited the $100 billion investment commitment under India’s trade agreement with the European Free Trade Association (EFTA) and a $20 billion commitment from New Zealand. The UK agreement includes a social security arrangement, while Australia removed a double-tax provision affecting Indian IT firms and service providers, he stated.

“Remember, any FTA, you find something which will differentiate us, unless it’s a very large country,” Goyal stated.

He additionally warned that Europe’s growing regulatory burden could undermine the competitiveness of its businesses and create opportunities for India.

“The more they regulate and over-regulate and create hurdles for their businesses, Europe is going to get wedged out of businesses,” he stated adding that his office was tracking new EU regulations and had counted 73 so far.

“Their automobiles will never be able to compete with ours, with all those regulations,” he stated, adding that restrictions on steel and cement and elevated production costs could make European infrastructure and housing more expensive.

“This will all give us the cost advantage,” he stated.

Goyal additionally flagged direct shipping as a challenge for Indian exporters and stated the government was working on changes to the maritime regulatory ecosystem to encourage firms to flag vessels in India.

India’s total exports touched $863 billion in 2025-26, Goyal stated, with the government targeting $1 trillion in total exports and more than $500 billion in merchandise exports.

The minister additionally highlighted India’s growing domestic economic base, saying semiconductor consumption demand is anticipated to exceed $150 billion annually within five years. India has grown from around 400-500 startups when Startup India was rolled out to more than 120 unicorns, making it the world’s third-largest startup ecosystem, he stated.