India and the European Union have finalized a historic trade agreement, as announced by Indian Prime Minister Narendra Modi on 27/1. "Yesterday, a major agreement was signed between the European Union and India. It will bring great opportunities for 1,4 billion Indians and millions of Europeans," Modi stated. Negotiations between the two sides began nearly two decades ago.
Modi and European Commission (EC) President Ursula von der Leyen are expected to issue a joint statement at the India - EU Summit in New Delhi on 27/1, where further details of the agreement will be announced.
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European Council President Antonio Costa, Indian Prime Minister Narendra Modi, and European Commission President Ursula von der Leyen on 27/1. Photo: Reuters |
European Council President Antonio Costa, Indian Prime Minister Narendra Modi, and European Commission President Ursula von der Leyen on 27/1. Photo: Reuters
The EU is currently India's largest trading partner. Bilateral trade reached 136,5 billion USD in the fiscal year ending March 2025. India, the world's most populous market, is also heavily protected. This agreement is set to open the Indian market to free trade with Europe.
This agreement follows closely on the heels of the EU reaching a trade agreement with the Southern Common Market (Mercosur) just days prior. The EU previously signed agreements with Indonesia, Mexico, and Switzerland last year. Similarly, New Delhi recently finalized agreements with the UK, New Zealand, and Oman.
This wave of international trade agreements reflects a global effort to de-risk from the US. US President Donald Trump recently intensified his intention to take over Greenland, even threatening to impose tariffs on European nations, shaking the long-standing alliance among Western countries. Last year, Trump also imposed a 50% tariff on goods from India because the country purchased Russian oil. Despite early negotiations, the two countries have not yet reached a trade agreement.
An Indian government official stated that the formal signing ceremony for the India - EU agreement will occur after a legal review process, expected to last five to six months. "We expect the agreement to be implemented within one year," the official said.
By Ha Thu (according to Reuters)
