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The European Union and India are set to announce a landmark trade deal after nearly two decades of on-off talks, as both sides aim to deepen ties amid tensions with the US.<\/p>\n
India’s Commerce Secretary Rajesh Agarwal said on Monday that negotiations had been wrapped up and the deal finalised.<\/p>\n
European Commission President Ursula von der Leyen and European Council President Ant\u00f3nio Lu\u00eds Santos da Costa are in Delhi, where the announcement is expected.<\/p>\n
Both India and the EU are seeking to strengthen strategic and trade ties with the rest of the world as they contend with economic and geopolitical pressure from the US. <\/p>\n<\/div>\n
Delhi is grappling with 50% tariffs imposed by President Donald Trump last year amid talks aimed at securing a trade deal between India and the US that are still dragging on.<\/p>\n
The EU has just emerged from a stressful week after Trump threatened to escalate his trade war with European allies for opposing a US takeover of Greenland before backing off<\/a>. <\/p>\n That larger geopolitical context was evident in recent statements made by leaders.<\/p>\n The trade deal will send an “important political message to the world that India and the EU believe more in trade agreements than in tariffs” at a time when protectionism is on the rise and “some countries have decided to increase tariffs”, Costa said on Monday without naming the US.<\/p>\n Von der Leyen said that Europe and India are “committed to working together to shape a new global order”.<\/p>\n Von der Leyen and Costa arrived in Delhi over the weekend and were the chief guests at India’s colourful Republic Day celebrations on Monday.<\/p>\n On Tuesday, they will meet Modi and attend a bilateral summit, after which the deal is expected to be formally announced.<\/p>\n The formal signing is likely to take place only later this year, after the agreement is approved by the European Parliament and the European Council.<\/p>\n<\/div>\n The deal will expand market access for Indian exports to Europe while easing entry for European investments and goods, such as cars and beverages, into Asia’s third-largest economy.<\/p>\n “This is a perfect example of a partnership between two major economies of the world… This agreement represents 25% of the global GDP and one-third of global trade,” Modi said while inaugurating the India Energy Week conference on Tuesday.<\/p>\n The EU is India’s largest trading partner in goods, with bilateral merchandise trade<\/a> reaching $136bn (\u00a399.4bn) in 2024-25, nearly doubling over a decade.<\/p>\n Talks for a deal between India and the EU started in 2007 but stalled in 2013 over roadblocks in market access and regulatory demands. Discussions were formally restarted in July 2022.<\/p>\n The main sticking points were access to India’s automobile market, agriculture goods and carbon-linked tariffs – and analysts will be reading the fine print to see what the final agreement says on these issues.<\/p>\n Officials from both sides worked hard over the past few days to finalise outstanding chapters of the agreement, aiming to wrap it up before the EU leaders’ visit.<\/p>\n The agreement – von der Leyen and India’s commerce minister Piyush Goyal have described it as the “mother of all trade deals” – comes as pressure grows on Delhi and Brussels to secure alternative markets for exporters.<\/p>\n In the past seven months, India signed major trade agreements with the UK<\/a>, Oman and New Zealand, and a 2024 pact signed with the four-nation European Free Trade Association bloc of Switzerland, Norway, Iceland and Liechtenstein has come into effect. <\/p>\n The EU, meanwhile, signed a trade deal<\/a> with South Asian trade bloc Mercosur earlier this month after 25 years of negotiation.<\/p>\n Follow BBC News India on <\/i>Instagram<\/i><\/a>, <\/i>YouTube,<\/i><\/a> <\/i>Twitter<\/i><\/a> and <\/i>Facebook<\/i><\/a>.<\/i><\/p>\n<\/div>\n