If I were to be employed by a European company to represent them in India to develop the market, what taxes and laws will apply? Secondly, how will the expenses made within the country and travel abroad be treated? What would be the best way to operate under the said conditions.
Taxes like income tax etc will be regulated by the double tax avoidance agreement between the EU country and India. Without it, both countries' laws applies which is why these agreements exist in the first place.
Look at article 15 in the OECD standard agreement which covers emplyee relations. Look at the commentary published by the OECD.
The EU company is likely getting into trouble by employing you. By doing so they easily get a "permanent establishment" in India. Not good. However if you are an independent agent without the right to sign on behalf of the company then that is not a permanent establishment.
You need to spend some time reading the OECD commentary.
Very simple. You live in india, you follow indian laws or go to indian jail. How can this question even come up?
Indian laws also say how you have to pay taxes and again the indian government has a free hotel called jail if you think you are smarter than the government.
That the company is in the EU is hardly of any relevance for your personal tax matters.