India and the European Union sealed a gistoric Free Trade Agreement (FTA) on Tuesday, following the announcement of the conclusion of a long-pending free trade agreement. European Commission President Ursula von der Leyen described it as the “mother of all deals” as Prime Minister Narendra Modi hosted top EU leadership for a high-level summit.
Historic Agreement Announced At Summit
Prime Minister Modi held talks with von der Leyen and European Council President Antonio Costa as the two sides sought to strengthen ties amid global geopolitical uncertainties and trade disruptions.
“Europe and India are making history today. We have concluded the mother of all deals. We have created a free trade zone of two billion people, with both sides set to benefit,” von der Leyen said. “This is only the beginning. We will grow our strategic relationship to be even stronger,” she added.
Both EU leaders were the chief guests at India’s 77th Republic Day celebrations at Kartavya Path on Monday.
India and the EU will sign a document formally declaring the conclusion of the FTA negotiations. Officials said the agreement may take at least six months to be formally signed, as it will undergo legal scrutiny on both sides.
Talks on the free trade agreement were first launched in 2007 but were suspended in 2013 due to differences over ambition. Negotiations were revived in June 2022.
Trade, Defence And Strategic Cooperation
The EU is India’s largest trading partner in goods. In the 2024–25 financial year, bilateral trade in goods stood at around USD 136 billion, with Indian exports valued at USD 76 billion and imports at USD 60 billion.
Beyond trade, the summit focused on defence and security cooperation, climate action, critical technologies and strengthening the rules-based global order. Alongside the FTA, the two sides are set to unveil a defence framework pact and a broader strategic agenda.
Defence, Mobility And Security Pacts
India and the EU have been strategic partners since 2004. Officials said a proposed Security and Defence Partnership (SDP) will deepen cooperation in defence and security, enhance interoperability, and open opportunities for Indian companies under the EU’s SAFE (Security Action for Europe) programme.
The SAFE initiative is a Euro 150 billion financial instrument aimed at boosting defence readiness across EU member states.
The two sides are also expected to launch negotiations for a Security of Information Agreement (SOIA), which is aimed at strengthening industrial defence cooperation. In addition, an agreement facilitating the mobility of Indian workers to Europe is likely to be signed, providing a framework for enhanced mobility initiatives by EU member states.
France, Germany, and Italy already have migration and mobility partnerships with India. Several other agreements across sectors are also expected to be concluded, while leaders are likely to exchange views on major global challenges, including the Russia-Ukraine conflict.
