India and EU Forge Historic Trade Agreement Amid Global Tensions

Mon Feb 02 2026 17:20:15 GMT+0200 (Eastern European Standard Time)

Leaders from India and the European Union are set to announce a significant trade deal aimed at enhancing economic ties and mitigating geopolitical pressures, particularly from the US.

A landmark trade deal between India and the EU, finalized after nearly two decades of negotiations, is on the horizon. With leaders in Delhi, both parties aim to strengthen their economic positions amid rising US tariffs and global trade challenges. The deal promises to open markets for Indian exports to Europe while facilitating European investments and goods in India. This agreement is seen as a pivotal step for both economies to counteract growing protectionism.

The European Union and India are set to announce a landmark trade deal after nearly two decades of on-off talks, as both sides aim to deepen ties amid tensions with the US.

India's Commerce Secretary Rajesh Agarwal said on Monday that negotiations had been wrapped up and the deal finalised.

European Commission President Ursula von der Leyen and European Council President António Luís Santos da Costa are in Delhi, where the announcement is expected.

Both India and the EU are seeking to strengthen strategic and trade ties with the rest of the world as they contend with economic and geopolitical pressure from the US.

Delhi is grappling with 50% tariffs imposed by President Donald Trump last year amid talks aimed at securing a trade deal between India and the US that are still dragging on.

The trade deal will send an important political message to the world that India and the EU believe more in trade agreements than in tariffs at a time when protectionism is on the rise. Von der Leyen stated that Europe and India are committed to working together to shape a new global order.

The deal is expected to expand market access for Indian exports to Europe while easing entry for European investments and goods, such as cars and beverages, into Asia's third-largest economy.

As the largest trading partner for India, the EU's bilateral merchandise trade with India reached $136 billion in 2024-25.

In recent months, India has signed significant trade agreements with countries such as the UK, Oman, and New Zealand, showcasing its strategic shift towards diversifying trade partnerships on the global stage.