India, EU Move Closer to Major Trade Agreement
India and the European Union are moving closer to finalising a long-pending free trade agreement, as both sides intensify negotiations to resolve remaining differences. Senior officials from India and the EU are engaged in high-level discussions aimed at narrowing gaps on market access, tariffs, and regulatory issues. The talks mark a critical phase in negotiations that were restarted in 2022 after being stalled for more than a decade.
The proposed agreement is expected to significantly deepen economic ties between the two sides, covering trade in goods and services, investment, customs cooperation, and sustainable development commitments.
Key Issues Under Negotiation
Several sensitive sectors remain under discussion. India is seeking improved access for its labour-intensive exports such as textiles, apparel, leather goods, and pharmaceuticals. The European Union, meanwhile, is pushing for lower tariffs on automobiles, wines, spirits, and certain industrial products, along with stronger rules on intellectual property and environmental standards.
Differences also persist over regulatory alignment, data protection, and the EU’s carbon-related trade measures, which India has raised as a concern for its exporters. Despite these challenges, negotiators on both sides have indicated progress on multiple chapters of the agreement.
Strategic Importance of the Deal
The European Union is among India’s largest trading partners, and a comprehensive trade deal is seen as strategically important amid shifting global supply chains and economic uncertainty. Officials believe the agreement could boost bilateral trade, attract investment, and enhance cooperation in emerging sectors such as clean energy, digital trade, and advanced manufacturing.
While no formal signing date has been announced, both India and the EU have signalled strong political intent to conclude the deal soon, potentially within the current year, if outstanding issues are resolved.
