Indian Prime Minister Narendra Modi said on Tuesday that his country has finalised a massive trade deal with the European Union, its biggest trading partner.
The two sides, which have sought to bolster dealings because of punitive tariffs imposed by the United States, will allow much greater trade between their two billion people – whose economies represent about a quarter of the global business.
The deal comes after close to two decades of on-and-off negotiations, which first started in 2007. It means India will open its large and long-protected market to ‘free trade’ with Europe’s 27 nations.
ALSO SEE: Seoul vows to act on US investments, after new tariff threat
“Yesterday, a big agreement was signed between the European Union and India,” Modi announced. “People around the world are calling this the mother of all deals.
“This agreement will bring major opportunities for the 1.4 billion people of India and the millions of people in Europe.”
Trade between India and the EU totalled $136.5 billion in the fiscal year to March 2025.
The pact was finalised at a summit between Modi and European Commission president Ursula von der Leyen and European Council president Antonio Costa. Von der Leyen said both sides are set to benefit.
A formal signing of the deal will take place after legal vetting, which is expected to take five to six months, meaning the agreement is likely to be implemented in mid-year.
Flurry of deals
Under the deal, India will remove tariffs on 90% of EU goods like wines, beer, spirits, processed food, machinery, medical equipment, chemicals and pharmaceuticals.
And the EU will reduce tariffs on Indian exports, such as textiles, leather, footwear, gems and jewellery, tea, coffee, spices, sports goods, toys and marine products.
The agreement comes just days after the EU signed a pact with the South American bloc Mercosur, plus deals with Switzerland, Indonesia and Mexico.
New Delhi has also signed trade pacts with Britain, New Zealand and Oman over the past year, spurred on by US President Donald Trump’s decision to impose a 50% tariff on goods and products from India.
Talks on a US-India trade deal collapsed in the middle of 2025, but restarted in recent months.
- Jim Pollard
ALSO SEE:
India ‘to cut tariffs’ on EU cars in ‘mother of all trade deals’
Carney leads trade shift from US, to China, India and Australia
India ‘could face higher tariffs if Russian oil buying continues’
Japan’s Sumitomo Realty Bets on Mumbai’s Booming Real Estate
EU To Reject India Demand For Carbon Tax Exemption — FT
India’s Green Transition In A Chokehold
India Plans Countrywide Climate Insurance Amid $180bn Losses
A European Push Could Help India Fill Carbon Removal Gaps
