India, EU finalise landmark trade deal
India and the European Union have finalised a long-awaited free trade agreement that will cover nearly a quarter of the global economy, Indian Prime Minister Narendra Modi announced on Tuesday, marking a major shift in global trade ties amid growing uncertainty in relations with the United States.
Speaking virtually at Indian Energy Week, Modi described the pact as a 'historic and significant agreement' reached after almost 20 years of intermittent negotiations. He said the deal would unlock vast opportunities for India’s 1.4 billion people and millions across Europe by deepening economic integration between the two sides.
The agreement will open India’s tightly protected markets further to the 27-member European Union, its largest trading partner, while offering Indian exporters improved access to European markets. Modi said the pact represents about 25 percent of global GDP and nearly one-third of world trade, underlining its scale and strategic importance.
European Commission President Ursula von der Leyen and Modi are expected to formally unveil the deal and its key provisions at an India–EU summit in New Delhi later on Tuesday. Trade between India and the EU reached $136.5 billion in the fiscal year ending March 2025, and officials expect the figure to rise sharply once the agreement comes into force.
The pact follows a series of trade deals signed by the EU and India with other partners, reflecting efforts by major economies to diversify alliances as tariff threats and geopolitical frictions intensify. Legal vetting of the agreement is expected to take several months, with implementation likely within a year, officials said.
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