India, EU Finalise Landmark Trade Deal, PM Modi Says

Reuters

European Commission President Ursula von der Leyen and India's Prime Minister Narendra Modi.

India and the European Union have finalised a landmark trade deal that will represent a quarter of the world's economy, Indian Prime Minister Narendra Modi said on Tuesday, as the two sides seek to hedge against fickle ties with the U.S.

After nearly two decades of on-off negotiations, the deal will pave the way for India to open up its vast and guarded market, the world's largest, to free trade with the 27-nation EU, its biggest trading partner.

"Yesterday, a big agreement was signed between the European Union and India," Modi said.

"People around the world are calling this the mother of all deals. This agreement will bring major opportunities for the 1.4 billion people of India and the millions of people in Europe," he said.

He added that the agreement represents 25% of global GDP and one-third of global trade.

PM Modi and European Commission President Ursula von der Leyen are expected to make a joint announcement later on Tuesday at the India–EU summit in New Delhi, where details of a new bilateral agreement are set to be unveiled.

Trade between India and the European Union reached USD 136.5 billion in the fiscal year ending in March 2025, underscoring the scale and strategic importance of economic ties between the two sides.

The agreement comes just days after the European Union concluded a landmark trade pact with the South American Mercosur bloc, following similar agreements reached last year with Indonesia, Mexico and Switzerland.

Over the same period, New Delhi finalised trade agreements with Britain, New Zealand and Oman, reflecting India’s broader push to diversify its economic partnerships.

This wave of agreements highlights global efforts to hedge against growing uncertainty in relations with the United States, as President Donald Trump’s bid to take over Greenland and his tariff threats against European countries strain long-standing Western alliances.

Tensions have also affected U.S.–India trade relations, with Washington imposing a 50 percent tariff on Indian goods and a prospective India–U.S. trade deal collapsing last year following a breakdown in communication between the two governments.

Source: Reuters



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