Global Trade Lexicon

Criteria used to determine the national source of a product for applying FTA preferential tariff rates.

Every FTA has its own RoO. India-EU FTA RoO will determine which Indian goods qualify for 0% duty.

Rule of origin requiring a product to be entirely produced in one country with no imported materials.

Agricultural products, minerals, live animals born in India are WO. Used for India agro-food FTA preference claims.

Rule of origin requiring a product to change its HS code through domestic processing.

Most common RoO for manufactured goods. Indian manufacturers must show imported inputs changed HS code through Indian processing.

Rule of origin requiring a minimum percentage of a product's value to originate within the FTA region.

India-ASEAN AIFTA: 35% ASEAN RVC. India-UAE CEPA: 40% India value addition for most goods.

A document certifying the country of origin of goods, required to claim FTA preferential tariff treatment.

Indian exporters must obtain COO from authorised issuing bodies: EEPC, EIC, FIEO, or Chambers of Commerce.

Registered Exporter System — EU system allowing certified exporters to self-certify origin on commercial documents.

Indian large exporters should register for REX to simplify EU GSP and future FTA origin documentation.

Preferential tariff scheme offered unilaterally by developed countries to developing countries.

India benefits from EU Standard GSP (~3.5% average preference). India-EU FTA will supersede GSP with 0% access.

FTA provision allowing inputs from certain countries to be treated as originating materials when calculating origin content.

Diagonal cumulation (PEM Convention) allows Indian goods processed in EU/EFTA/Turkey to accumulate EU origin.

Cumulation between the two FTA parties — materials from Party A treated as originating when used in processing in Party B.

India-EU FTA will likely include bilateral cumulation: EU materials used by Indian manufacturers can be treated as Indian origin.

Cumulation across multiple countries sharing the same rules of origin framework (e.g., PEM Convention).

Pan-Euro-Mediterranean Convention allows diagonal cumulation across EU, EFTA, Turkey, and 15+ Mediterranean countries.

Rules of origin specific to individual products or categories within an FTA schedule.

India-EU FTA will have PSRs for sensitive products — pharma may require synthesis in India; textiles may require double transformation.

A reduced or zero import duty available to goods qualifying for FTA or GSP treatment.

Indian exporters must present qualifying COO/REX and meet RoO to access EU FTA preferential tariff rates.

WTO principle requiring tariff concessions to one WTO member to be extended to all WTO members unless FTA exception applies.

India's average MFN tariff is ~13%. EU's average MFN is ~5%. FTAs reduce these to 0% on qualifying goods.

A mechanism allowing a specified quantity of a product to be imported at a lower in-quota tariff.

India-EU FTA will include TRQs for sensitive agro products — basmati rice, spices, processed food.

The removal of an import duty on a product, typically over a phased schedule agreed in an FTA.

India-EU FTA aims to eliminate tariffs on 90%+ of goods over 7-10 years. Day 1 eliminations expected for pharma, engineering.

Products excluded from tariff elimination or given limited preferences due to domestic industry sensitivity.

India sensitive list in India-EU FTA: dairy, wine, autos. EU sensitive list: textiles, leather, pharma APIs.

Trade barriers other than tariffs — standards, regulations, customs procedures, licensing requirements, SPS measures.

NTBs are often more significant than tariffs for India-EU trade. CE marking, REACH, EU food standards are major NTBs.

Cross-border supply of services delivered from one country to another without movement of persons — e.g., IT services remotely.

India's dominant service export mode. Indian IT companies export USD 150B+ in Mode 1 services annually.

Movement of natural persons — service providers travel temporarily to supply services in another country.

Critical for Indian IT professionals working on-site at EU client locations. Priority in India-EU FTA services chapter.

A sign used on products that have a specific geographical origin and possess qualities or a reputation due to that origin.

India-EU FTA GI chapter: India seeks protection for Darjeeling tea, Basmati rice, Kashmir Pashmina in EU.

FTA requirement that goods be shipped directly between partner countries without manipulation in third countries.

Indian goods transshipping via UAE or Singapore must have evidence of continuous transit to satisfy direct shipment requirement.

When a material obtains originating status, its full value counts as originating in further processing. Also called roll-up.

Indian semi-finished originating goods can be used as 100% originating inputs in further processing for EU export.

Textile rule of origin requiring yarn-to-fabric AND fabric-to-garment transformation in the exporting country.

EU FTA textile RoO typically requires double transformation. Indian garments must use Indian (or EU-cumulated) yarn and fabric.

Processing must go beyond minimal operations — beyond mere assembly, packaging, labelling, or cutting.

Insufficient operations do not confer origin. Substantial processing required in India to qualify for FTA preference.

The physical exchange of goods between countries — the goods chapter of an FTA covering tariff schedules and NTBs.

Trade in Goods is the primary chapter of India-EU FTA covering tariff elimination schedules across 8,500+ tariff lines.

The exchange of services across borders — Mode 1-4 coverage in an FTA services chapter.

Trade in Services is critical for India-EU FTA — covering IT services, pharma, professional services, financial services.

The country of origin determined for non-FTA purposes — for applying anti-dumping duties, safeguards, or labelling requirements.

Non-preferential origin rules are different from FTA preferential rules. Both sets of rules may apply simultaneously.

The certificate of origin historically used under EU GSP by exporters in beneficiary developing countries. Being replaced by REX.

Indian exporters still using Form A should transition to REX registration for simplified EU GSP origin certification.