India and the European Union on Tuesday announced the ambitious free trade agreement (FTA)—described by both sides as the ‘mother of all deals’—amid a heightened tariff tension between New Delhi and the United States.
Prime Minister Narendra Modi and European Commission President Ursula von der Leyen jointly announced the FTA’s conclusion at the 16th India–EU Summit in New Delhi, marking a new era in trade engagement.
According to the Ministry of Commerce and Industry, the FTA establishes India and the EU as trusted partners committed to open markets, predictability, and inclusive growth.
"Today, India has signed the biggest free trade agreement in its history with the European Union," Modi stated after the summit talks. "This is not just a trade deal; it's a blueprint for shared prosperity."
Government data reveals that the EU is one of India’s largest trading partners. In 2024-25, India’s bilateral trade in goods with the EU reached USD 136.54 billion, with exports totaling USD 75.85 billion and imports at USD 60.68 billion. Additionally, trade in services amounted to USD 83.10 billion.
Modi emphasised that such agreements strengthen a rules-based economic order and foster shared prosperity. "That’s why today’s FTA is of historic importance. It is one of the most ambitious agreements ever concluded," he said.
The EU and India first began negotiations for the FTA in 2007, though talks were suspended in 2013 due to differences in ambition. Negotiations resumed in June 2022.
In her remarks, Von der Leyen echoed the sentiment, declaring, "We delivered the mother of all deals."
As the world’s 4th and 2nd largest economies, India and the EU together account for 25% of global GDP and one-third of global trade. Their integration will create vast trade and investment opportunities.
The trade pact covers a wide range of areas, including trade in goods and services, customs and trade facilitation, as well as emerging sectors like digital trade and small and medium enterprises (SMEs).
