Key points
- Tariff cuts to boost bilateral trade
- EU exports to India set to double
NEW DELHI: The European Union and India have finalised a long-awaited trade agreement, marking a significant shift in global economic alignments as countries respond to growing uncertainty driven by US trade policy under President Donald Trump.
According to Bloomberg, the deal concludes nearly two decades of intermittent negotiations and reflects a shared effort by both sides to reduce reliance on traditional partners. The EU is seeking to lessen its dependence on the United States and China, while India aims to shed its protectionist image and balance its international relationships, including ties with Russia.
European Commission President Ursula von der Leyen described the agreement as “the mother of all deals” in a social media post, while Indian Prime Minister Narendra Modi called it India’s “biggest and most historic” trade pact.
Seven-year transition period
Under the agreement, EU exports to India are expected to double by 2032, following the removal of tariffs on 96.6 per cent of shipments. In return, the EU will eliminate or reduce tariffs on 99.5 per cent of goods imported from India over a seven-year transition period.
The deal comes at a time of heightened trade tensions globally, fuelled by Washington’s aggressive tariff policies and broader disruptions to the international trading system. Recent US warnings and disputes, including over Greenland, have added to the uncertainty.
Analysts say the EU–India agreement highlights how major economies are recalibrating trade strategies in response to a rapidly changing geopolitical and economic landscape.
