India's trade minister said on Friday the European Union's "irrational standards" are hurting business ties and additional tariffs on select imports would force India to retaliate, in his sharpest criticism of the bloc's policies amid trade pact talks.

"Irrational standards set by the European Union act as a trade barrier to expanding trade," the minister, Piyush Goyal, said at an event in the New Delhi with Indian and European businesses in attendance.

Goyal also slammed the bloc for "unfair rules" such as a proposed EU carbon border tax known as the carbon border adjustment mechanism (CBAM), adding such measures disrespect and seek to demolish the premise of the 2015 Paris climate agreement.

The EU last year approved the world's first plan to impose tariffs on imports of high-carbon goods including steel, cement and aluminium, aiming to reach net-zero greenhouse emissions by 2050. EU officials have been trying to win over countries like China, South Africa and India, that are opposed to CBAM.

The bloc has also extended safeguard duties on select steel imports, that were set to expire this year, till 2026, impacting Indian shipments. "For 5-6 years now, we have only been negotiating irrational duties," Goyal said, adding India may now have to take measures "not conducive" for good commercial ties.

In 2022, India and the EU agreed to relaunch talks on a free trade agreement, initially aiming to complete talks by the end of 2023, but have failed to make significant progress on a deal.

The two sides previously launched talks in 2007, but they were frozen in 2013 due to lack of progress.

(Reporting by Shivangi Acharya, Editing by William Maclean)