India and Europe aim to finalize a thorough trade agreement when European Union (EU) chiefs meet Prime Minister Narendra Modi in New delhi next week,strengthening ties between the two major economies.
Both India and the European Union face challenges from China and the United states, and have been negotiating a significant free trade pact for approximately two decades,with talks now nearing completion.
“We are on the cusp of a historic trade agreement,” European Commission President Ursula von der leyen stated this week.
Von der Leyen and European Council president Antonio Costa will attend Republic Day celebrations on Monday, followed by an EU-India summit on Tuesday, where they hope to formally agree on the deal.
India’s Commerce Minister Piyush Goyal described the potential agreement as “the mother of all deals.” Securing this pact represents a critically importent opportunity for both Brussels and New Delhi to expand into new markets,especially in response to US tariffs and Chinese export controls.
However, officials emphasize the relationship extends beyond purely commercial interests.
“The EU and India are growing closer at a time when the rules-based international order faces unprecedented strain from conflicts, coercion, and economic fragmentation,” said the EU’s top diplomat, Kaja Kallas, on Wednesday.
‘Untapped potential’
Russia’s invasion of Ukraine and former US President Donald Trump’s tariffs have accelerated the India-EU relationship, according to Praveen Donthi of the International Crisis Group.
“The EU views India as a key market and seeks to encourage India to move away from reliance on Russia, while India aims to diversify its partnerships, reinforcing its strategy of multi-alignment, especially given recent challenges in its relationship with the US,” Donthi explained.
