'Mother of all deals': Modi hails historic India-EU trade pact
What's the story
Prime Minister Narendra Modi has called the India-European Union Free Trade Agreement (FTA) the "mother of all deals." The FTA, which represents nearly 25% of global GDP and about one-third of global trade, is expected to deepen ties between the two major economies. The announcement comes ahead of the 16th India-EU Summit in Delhi, where PM Modi will hold talks with European Commission President Ursula von der Leyen and European Council President Antonio Costa.
Announcement details
India-EU trade pact to be formally announced
Commerce Secretary Rajesh Agrawal confirmed that India and the EU have concluded negotiations on the FTA. The formal announcement of the trade agreement will be made on Tuesday, January 27, 2026. The deal is expected to come into force next year after legal scrubbing of the text, which could take up to six months, followed by formal signing.
EU's stance
EU's commitment to India's growth
European Commission President Ursula von der Leyen, who was a chief guest at India's Republic Day parade, emphasized the importance of India's growth. She wrote on X: "A successful India makes the world more stable, prosperous, and secure. And we all benefit." The deal has attracted international attention, with US Treasury Secretary Scott Bessent raising concerns over Europe's continued purchase of refined Russian oil products from India.
Pact goals
India-EU trade pact aims to boost prosperity
Commerce Minister Piyush Goyal said the FTA aims to boost prosperity for businesses and people on both sides. He called the engagement between India and the EU "sustained & constructive," adding that it "has brought us closer to a fruitful outcome." The European Union is India's largest trading partner in goods, with bilateral trade estimated at around $136 billion in 2024-25.
Industry impact
India-EU trade pact's potential impact on domestic industry
Analysts expect the India-EU trade pact to expand trade without posing major risks to the domestic industry. The Global Trade Research Initiative founder, Ajay Srivastava, told PTI that India and the EU are partners operating on different rungs of the value chain, which is likely to lower costs and expand trade rather than threaten Indian industry.