India-Italy Trade Nears Double in 5 Years Ahead of PM Modi’s Rome Visit

India-Italy trade has seen sharp growth over the past five years, with bilateral commerce crossing ₹1.16 lakh crore in FY25 ahead of Prime Minister Narendra Modi’s Italy visit on 19 May. New agreements in green energy, manufacturing and digital cooperation are expected during the high-level talks in Rome.

Modi’s Italy Visit

Prime Minister Narendra Modi is set to arrive in Italy on Tuesday as part of the final leg of his Europe tour, with trade and strategic cooperation expected to dominate discussions between New Delhi and Rome.

Officials familiar with the preparations said both sides are likely to sign multiple Memorandums of Understanding (MoUs) covering sectors such as green energy, digital technology, maritime infrastructure and industrial manufacturing. The visit comes at a time when bilateral trade between the two countries has shown sustained expansion despite global economic uncertainties.

According to recent trade assessments by the India Brand Equity Foundation (IBEF) and commerce-related data, India and Italy have steadily deepened their economic partnership over the last few years, moving beyond traditional trade ties into broader strategic collaboration.

No Separate FTA

One of the recurring questions around India-Italy business relations concerns the existence of a separate Free Trade Agreement (FTA) between the two countries.

India does not currently have an independent bilateral FTA with Italy. Since Italy is a member of the European Union, trade negotiations are handled collectively through the broader India-European Union framework.

Negotiations for the India-EU trade agreement have been under discussion for several years. The proposed pact is expected to reduce tariffs, simplify customs procedures and improve market access for businesses operating between India and European member states, including Italy.

Trade experts say progress on the wider India-EU deal could significantly benefit sectors such as engineering goods, textiles, automobiles and pharmaceuticals.

Exports To Italy

India continues to maintain a trade surplus with Italy, exporting more goods to the European nation than it imports.

Data from the Directorate General of Commercial Intelligence and Statistics (DGCI&S) indicates that key Indian exports to Italy include iron and steel products, ready-made garments, textiles, chemicals, machinery, electronics and automobiles.

Industry representatives say Indian textile exporters, in particular, have benefited from growing demand in European fashion and manufacturing markets after the post-pandemic recovery.

Engineering goods and automotive components have also emerged as strong contributors to India’s export basket to Italy over the last few years.

Imports From Rome

On the import side, India relies heavily on Italian industrial expertise and high-end manufacturing products.

Major imports from Italy include industrial machinery, machine tools, vehicle parts, pharmaceutical products and speciality chemicals. Italian firms are particularly known for precision engineering equipment used across India’s automotive, infrastructure and manufacturing sectors.

Officials tracking bilateral trade said Indian demand for advanced machinery has remained stable even during periods of global supply-chain disruptions.

The growing push for industrial modernisation under India’s manufacturing expansion plans has further increased the need for specialised equipment sourced from European countries like Italy.

Trade Growth Since Pandemic

Bilateral trade between India and Italy has nearly doubled over the last five years, aided by economic recovery after the Covid-19 slowdown and stronger business engagement.

Official commerce data shows total bilateral trade touched around ₹1.16 lakh crore in FY25. Italy’s share in India’s overall trade remains slightly above one per cent, but officials say the relationship carries strategic importance because of Italy’s role in European manufacturing and technology supply chains.

The trade trajectory witnessed a sharp rise after 2021 as both economies reopened following pandemic-related restrictions. Export growth from India accelerated during this period, while imports from Italy also climbed steadily due to rising industrial demand.

Strategic Sectors In Focus

Sources familiar with the ongoing discussions said the upcoming agreements are expected to focus on future-oriented sectors rather than only traditional trade.

Green hydrogen, renewable energy systems, digital partnerships, port modernisation and advanced manufacturing are likely to feature prominently during the bilateral talks.

Analysts believe the visit could also help Indian companies gain wider access to European supply networks at a time when businesses are seeking alternatives and diversification in global production chains.

The India-Italy trade relationship, though smaller in scale compared to some of India’s larger partners, has steadily evolved into a multi-sector economic partnership with growing strategic relevance for both sides.