- The formal signing will take six months, says an Indian government official.
- He says implementation of the agreement is expected within a year.
- Trade between both sides will reach $136.5 billion in fiscal year 2025.
India and the European Union have concluded negotiations on a long-coveted trade deal to be announced on Tuesday, the South Asian nation’s commerce secretary said on Monday, a deal both sides hailed as historic as they face strained relations with the United States.
The deal paves the way for free trade in goods between the bloc of 27 European nations and India, which together account for a quarter of the world’s gross domestic product and a market of 2 billion consumers.
“It will be a balanced and forward-looking deal for better economic integration with the EU. The deal will boost trade and investment between both sides,” said India’s Commerce Secretary Rajesh Agrawal.
Trade between the two sides amounted to $136.5 billion in the fiscal year to March 2025.
Avalanche of trade agreements
The formal signing would take place after a legal investigation that is expected to last five to six months, an Indian government official familiar with the matter said.
“We hope the agreement will be implemented within a year,” the official added.
The agreement comes days after the EU signed a key pact with the South American bloc Mercosur, following last year’s agreements with Indonesia, Mexico and Switzerland.
During the same period, New Delhi concluded agreements with Britain, New Zealand and Oman.
The series of agreements underscores global efforts to protect against the United States as President Donald Trump’s attempt to seize Greenland and tariff threats to European countries test long-standing alliances between Western nations.
After almost two decades of on-again, off-again negotiations, the agreement will allow India to open its vast and guarded market, the world’s largest, to free trade with the EU, its largest trading partner.
Quick talks agreed last year
India and the EU pushed to close the deal after Prime Minister Narendra Modi and European Commission President Ursula von der Leyen agreed to accelerate negotiations last year.
The two-way talks, relaunched in 2022 after a nine-year hiatus, gained momentum after Trump imposed import tariffs on several trading partners, including a 50% tariff on goods from India.
A trade deal between India and the United States collapsed last year after a breakdown in communication between their two governments.
Both the EU and India had been locked in a last-minute give-and-take over auto and steel trade, among the latest points of contention.
The EU had sought sharp cuts from India in import tariffs on its cars that can exceed 100%, while India – a major steel producer – has been pressing the EU to reduce trade restrictions on its steel exports.
Reuters reported on Sunday that India planned to reduce tariffs on cars imported from the EU from 110% to 40% as part of the deal.
The negotiations excluded some sensitive agricultural and dairy products, as New Delhi maintains the need to protect millions of subsistence farmers.
