Turkish Trade Minister Omer Bolat has dismissed concerns that a proposed free trade agreement between the European Union and India could cause significant losses for Türkiye in the EU market, rejecting claims that Ankara would lower customs duties toward India.
Speaking to Anadolu, Bolat said reports suggesting Türkiye would reduce tariffs due to an EU–India deal were “completely unfounded,” stressing that there is no such plan or agenda. His remarks came as he evaluated the Türkiye–EU Customs Union and the implications of the EU’s negotiations with India.
Bolat said efforts to update the Customs Union are longstanding, noting that the issue was first raised with the EU in 2014. He described the Customs Union, in force since 1995, as a central driver of Türkiye’s economic transformation and its integration into European value chains, supported by alignment with EU technical regulations that strengthened industrial competitiveness.
Bilateral trade between Türkiye and the EU has expanded eightfold over the past 30 years to $233 billion, while the export-to-import coverage ratio has reached 100%, Bolat said. He added that this growth reflects a structural shift, with medium- to high-technology products now making up 43.5% of Turkish exports and Türkiye’s share of global exports rising to 1.07%.
Bolat said the current Customs Union framework, largely focused on industrial goods, no longer reflects global economic realities. Excluding areas such as services, the digital economy, public procurement, and agriculture has limited the full potential of bilateral trade, he said.
He pointed to structural challenges, including asymmetries created by EU free trade agreements with third countries, Türkiye’s limited role in related decision-making, transport quotas affecting Turkish carriers, and expectations on the mobility of Turkish businesspeople within the EU.
Updating the Customs Union, he said, has become a strategic necessity to strengthen European value chains amid global economic uncertainty.
Since 2023, Türkiye and the EU have resolved many priority trade issues through a more constructive approach, with the High-Level Trade Dialogue serving as a platform for problem-solving and groundwork for an update.
Bolat said the process is now not only a Turkish demand but also an EU economic security need, given geopolitical risks, supply chain vulnerabilities, and efforts to reduce dependencies in sectors such as energy and defense.
Rejecting claims that the Customs Union harms Türkiye, Bolat said 43% of Turkish exports went to the EU in 2025, with trade expanding in a balanced manner. Exports to the EU totaled $117 billion that year, while imports stood at $115 billion, lifting the export-to-import coverage ratio from 50% in 1995 to above 100%.
He added that more than 60% of the $295 billion in foreign capital entering Türkiye over the past 25 years originated from EU countries.
Bolat said the European Green Deal has reshaped access conditions for the EU market, making green transformation both a requirement and a competitive advantage. Türkiye aims to strengthen its position as a fast, reliable, high-quality, and green supplier by aligning quickly with new EU standards, supported by financing and compliance programs for exporters.
Market diversification remains a priority, with 60 countries designated as export targets in 2026, alongside initiatives under the Distant Countries Strategy.
On the EU–India agreement, Bolat said it reflects the EU’s effort to diversify trade partners. He noted that Türkiye is also expanding its preferential trade network, which includes 24 free trade agreements and six preferential arrangements.
While India is the world’s fifth-largest economy, he said its exports account for about 11% of GDP, and its export-to-import coverage ratio is 62%, indicating a more inward-focused production structure.
Bolat said EU tariffs on major Indian exports are already low or zero, meaning the agreement would mainly expand EU market access. He added that Turkish exports under the Customs Union benefit from free circulation without rules-of-origin requirements, giving Türkiye an advantage over EU free trade partners.
Technical regulations, rather than tariffs, now shape competitiveness, supported by Türkiye’s proximity, logistics strengths, and compliance with EU standards.
Any potential trade diversion involving Indian-origin goods entering Türkiye through the EU will be closely monitored, Bolat said, reiterating that claims that Türkiye will lower customs duties toward India due to the EU–India agreement are “completely unfounded.”
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