European Union and India free trade agreement mother of all deals

Visakhapatnam: The European Union and India have clinched a pact that has been described as mother of deals. It was a landmark trade deal after nearly two decades of on-off talks. The deal comes as both India and the EU contend with economic and geopolitical pressure from the US.

European Union President Ursula von der Leyen and European Council President Ant'nio Costa who were in Delhi, where they met Prime Minister Narendra Modi at the conclusion of the India'European Union Free Trade Agreement (India'EU FTA) at the 16th India'EU Summit, held during the visit of the European leaders to India. This announcement marks a historic milestone in India'EU economic relations and trade engagement with key global partners. The deal will see a number of huge tariff cuts across a range of goods and services, and a joint security partnership.

The conclusion of this FTA positions India and the European Union as trusted partners committed to open markets, predictability, and inclusive growth. The FTA comes after intense negotiations since the re-launch of negotiations in 2022. The announcement of the FTA marked the culmination of years of sustained dialogue and cooperation, between India and the EU, demonstrating the political will and shared vision to deliver a balanced, modern, and rules-based economic and trade partnership.

The European Union is India's one of the largest trading partner, with bilateral trade in goods and services growing steadily over the years. In 2024'25, India's bilateral trade in goods with the EU stood at ₹ 11.5 Lakh Crore ($ 136.54 billion) with exports worth ₹ 6.4 Lakh Crore ($ 75.85 billion) and imports amounting to ₹ 5.1 Lakh Crore ($ 60.68 billion). India-EU trade in services reached ₹ 7.2 Lakh Crore ($ 83.10 billion) in 2024.

India and EU are 4th and 2nd largest economies, comprising 25% of Global GDP and account for one third of global trade. Integration of the two large diverse and complementary economies will create unprecedented trade and investment opportunities.

The India'EU FTA marked a new chapter in bilateral economic engagement, strengthening trade, and strategic cooperation between India and the 27-member EU bloc. EU becomes India's 22nd FTA partner. The Government since 2014 has signed trade deals with Mauritius, UAE, UK, EFTA, Oman and Australia, and announced trade deal with New Zealand. In 2025, India signed trade deal with Oman and UK and announced conclusion of trade deal with NZ.
The India-EU trade deal, along with India's FTA with the UK and the EFTA effectively opens up the entire European market for Indian businesses, exporters and entrepreneurs.

The FTA is expected to facilitate cooperation in critical areas like Artificial Intelligence, clean technologies, and semiconductors, supporting India's technological advancement.

The FTA is expected to substantially scale up trade, enhance export competitiveness, and integrate Indian businesses more deeply into the European and global value chains.

Beyond boosting commerce, it reinforces shared values, fosters innovation, and creates opportunities across sectors and stakeholders from MSMEs, women and skilled professionals to farmers and exporters. Aligned with India's vision of 'Viksit Bharat 2047,' the FTA positions India as a dynamic, trusted, and forward-looking partner on the global stage, setting the foundation for inclusive, resilient, and future-ready growth for both regions.