Confindustria Identifies India as a Priority Market for Italian Export Diversification

Confindustria's latest economic outlook reinforces the strategic relevance of India. The IICCI's Italy–India Economic Observatory provides further evidence of the opportunities, competitive gaps and industrial partnerships that could shape the next phase of bilateral economic relations.

15 October 2026 | International Trade & Market Access

Italy's latest economic outlook reinforces the strategic relevance of India. The IICCI's Italy–India Economic Observatory provides further evidence of the opportunities, competitive gaps and industrial partnerships that could shape the next phase of bilateral economic relations.

India has been identified among the priority markets for Italian export diversification in the latest economic outlook published by Centro Studi Confindustria (See Report) on 14 October 2026.

The report highlights the increasing importance of trade agreements, international market diversification and the reduction of tariff and non-tariff barriers in strengthening the competitiveness of Italian businesses, particularly small and medium-sized enterprises.

Confindustria’s recommendations are relevant in the context of Italy’s growing economic relationship with India and the prospective implementation of the EU–India Free Trade Agreement. They also align with the findings of the Italy–India Economic Observatory, launched by the Indo-Italian Chamber of Commerce and Industry (IICCI) in September 2026 to provide a structured, evidence-based assessment of bilateral trade, investment, industrial cooperation and emerging market opportunities.

Italy–India trade: growth, but significant potential remains

According to the Economic Observatory’s inaugural report, Italian merchandise exports to India reached €5.50 billion in 2025, increasing by 7.4% compared with the previous year. Over 2020–2025, Italian exports to India increased by approximately 82%. The wider bilateral picture is more nuanced: Italian imports from India declined by 4.1% in 2025, bringing total merchandise trade to around €14.23 billion, broadly unchanged from 2024.

The Economic Observatory also highlights differences in India’s importance as an export destination for selected European suppliers. In 2025, India accounted for 1.76% of Italy’s extra-EU exports, compared with 2.36% for Germany and 2.28% for France. Although Italy recorded stronger growth in exports to India in that year, these figures indicate a gap that warrants examination at product and sector level; they do not by themselves establish demand available to individual companies.

From export diversification to industrial partnerships

India’s importance for Italian business extends beyond exports. IICCI’s July 2026 mapping identifies 1,057 Italian companies in India, reflecting an established presence across commercial and industrial activities. This is an IICCI mapping, not an independently audited census.

The Economic Observatory examines bilateral cooperation through three macro-sectors: Advanced Technologies (Space, Aerospace and Defence; Environmental Transition; Energy Transition); Manufacturing (Machinery; Agri-food Technologies; Infrastructure and Construction; Pharmaceuticals and Chemicals; Automotive and Components); and Consumer Goods (Fashion; Furniture and Design; Food and Wine; Cosmetics; Sports).

Potential routes to market differ considerably, ranging from export distribution to supplier development, joint engineering, local production and investment. Each requires validation of customer demand, technical and regulatory requirements, partner capabilities and implementation arrangements.

EU–India FTA: preparing for market access

The EU–India Free Trade Agreement offers a prospective framework for stronger economic integration, but its benefits should not be treated as currently available. As recorded in the Economic Observatory’s September 2026 edition, negotiations concluded on 27 January 2026 and the European Commission submitted proposals for signature and conclusion on 11 September 2026. The agreement was not in force at the Economic Observatory’s editorial cut-off. Its legal status must be checked again at publication.

Tariffs are only one part of market access. Technical standards, certification, testing, labelling, customs procedures and the structure of local distribution can materially affect competitiveness.

The Economic Observatory therefore recommends preparing at product level: checking current rules and landed costs, qualifying partners and establishing compliance; any prospective tariff preference should be modelled separately until its timing, product classification and origin requirements are confirmed.

The role of the Italy–India Economic Observatory

Promoted by IICCI, in partnership with SDA Bocconi Asia Center, the Italy–India Economic Observatory aims to offer a continuous, evidence-based reference for bilateral trade, investment, company presence and sector-level opportunities.

Issue 0, presented at the IICCI's Annual General Meeting in September 2026, combines statistics with proposed practical priorities: manufacturing upgrading, project-led market access, partnerships between established investors and targeted engagement on technological and regulatory issues.

Rather than equating market potential with immediate sales, its approach is to identify concrete requirements, suitable partners and measurable follow-up. For IICCI, success should be assessed not only through export volumes but through durable industrial partnerships, stronger supply chains and sustained market participation.

In this sense, Confindustria’s call for diversification and the Economic Observatory’s analysis point to a common practical priority: translating India’s strategic importance into commercially viable outcomes for companies in both countries.

Sources and further reading

• Centro Studi Confindustria, Economic Outlook, 14 October 2026 (Report Page).

• IICCI, Italy–India Economic Observatory, Issue 0, September 2026: pp. 7, 10–11, 15, 52–54, 56.

• EU–India Free Trade Agreement: refer to current official EU documentation for legal status.

• init - Italy-India Economic Observatory: [In English] [In Italian]