The long-awaited India-EU Free Trade Agreement has been finalised and will be announced at the January 27 summit in New Delhi, with signing due in 2026 and rollout from 2027.
New Delhi: India and the European Union have successfully completed negotiations on a major Free Trade Agreement (FTA), marking a significant milestone in their economic relationship.Officials will officially announce the deal on January 27, 2026, during the India-EU Summit in New Delhi and expect to sign it later this year, with implementation planned for early 2027.
Officials often describe the agreement as the “mother of all trade deals,” and expect it to strengthen trade, investment, and strategic cooperation between India and the EU amid global economic uncertainty.
Long Negotiation Process Finally Concludes
India and the European Union began talks for the FTA in 2007, but both sides paused negotiations in 2013 due to differences over tariffs, intellectual property rights, and market access. After an eight-year pause, discussions resumed in June 2021.
Since then, both sides held 10 rounds of negotiations, with the final round concluding in late 2025. The agreement text has now gone through legal review, clearing the way for its formal announcement. This will become India’s ninth trade agreement in the past four years, supporting its goal of reaching $1 trillion in exports by 2030.
India-EU Summit and Leadership Participation
The January 27 summit will be led by Prime Minister Narendra Modi for India. European Council President Charles Michel and European Commission President Ursula von der Leyen will represent the European Union.
EU leaders arrived in India ahead of the summit, with discussions expected to cover not just the FTA but also a possible strategic defence partnership and a framework for mobility and migration of skilled professionals. Highlighting the broader importance of the deal, Ursula von der Leyen stated that “a successful India makes the world stable.”
Key Features of the Trade Agreement
The FTA is a wide-ranging agreement covering goods, services, and investment. India will gradually reduce import duties on EU products such as cars, wines, dairy items, and machinery. In return, Indian exporters will gain improved access to the EU market for textiles, jewellery, pharmaceuticals, and agricultural products.
The deal also includes provisions on investment protection, geographical indications—such as protection for Indian basmati rice and European cheeses—and expanded access in services like IT and telecom. Chapters on sustainability address labour standards, environmental protection, climate goals, and EU regulations such as the Carbon Border Adjustment Mechanism (CBAM) and deforestation rules. At the same time, sensitive Indian sectors like dairy and automobiles will remain shielded from complete liberalisation.
Expected Economic and Strategic Gains
Current India-EU trade stands at over €120 billion and is expected to grow to €200–300 billion within the next 5 to 10 years. India is likely to see a significant boost in exports, with textiles projected to grow by 20–30 percent and pharmaceuticals by around 15 percent, along with increased job creation and stronger supply chains.
For the EU, the deal offers greater market access for exports such as cars and wines, which could rise by 25–50 percent, while also securing partnerships for critical minerals and semiconductors. EU foreign direct investment in India, already above €100 billion, is expected to increase further.
Official Responses and What Comes Next
India’s Commerce Ministry has welcomed the agreement as the “mother of all deals,” while the European Commission has described it as a landmark achievement. Following the January 27 announcement, the agreement will go through formal approval processes, including clearance from the European Parliament and relevant Indian authorities.
Officials expect both sides to sign the deal later in 2026 and fully implement it in 2027. They say the agreement resolves long-standing issues such as tariffs and intellectual property rights, making it a potential model for future global trade partnerships.
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