EditEU and India accelerate Free Trade Agreement amid global shifts
The urgency to finalise the FTA stems from global pressures
The rapidly evolving geopolitical landscape is breathing new life into negotiations for a Free Trade Agreement (FTA) between India and the European Union, writes Nawab Khan. , an Indian journalist based in Brussels.
Nawab Khan is an Indian journalist and a veteran Brussels journalist. He can be reached at nawab_khan@hotmail.com
Amid the Ukraine war, U.S. President Donald Trump’s tariff wars, and India’s strained relations with China and Pakistan, a breakthrough in the EU-India FTA seems more achievable than ever.
On 23 May, European Commissioner for Trade Maroš Šefčovič expressed optimism after talks with India’s Commerce and Industry Minister Piyush Goyal in Brussels, their second meeting that month.
In a post on X, Šefčovič noted steady progress and urged both sides to maintain momentum, anticipating further discussions soon. Goyal reciprocated on X, reaffirming India’s commitment to “shared prosperity” with the EU. This follows a February 2025 meeting in New Delhi, where European Commission President Ursula von der Leyen and Indian Prime Minister Narendra Modi set a December 2025 target for concluding the FTA.
The EU-India FTA talks, relaunched in June 2022 after collapsing in 2013 over sectoral disagreements, have now completed 11 rounds, with the latest in Delhi on 16 May. The next round is slated for July.
Adopting a phased approach akin to India’s trade pacts with Australia and ongoing U.S. talks, both sides aim for an interim agreement covering intellectual property rights, government procurement, and tariff and non-tariff barriers. The EU is pushing for significant tariff cuts on products like automobiles, medical devices, meat, and spirits, while India seeks balanced concessions.
The urgency to finalise the FTA stems from global pressures. India faces a 26% retaliatory tariff from the U.S., which Goyal sought to mitigate during intensive talks in Washington before his Brussels visit. An interim U.S.-India trade deal is expected by July 8, 2025, to avert these tariffs. Meanwhile, India’s recent FTA with the UK, signed on May 6, 2025, eliminates tariffs on 99% of Indian tariff lines and 90% of UK lines, boosting bilateral trade by an estimated 15% annually.
In 2023, EU-India goods trade reached €124 billion, accounting for 12.2% of India’s total trade, surpassing the U.S. (10.8%) and China (10.5%). The EU is India’s second-largest export destination (17.5%), just behind the U.S. (17.6%), while bilateral services trade hit €59.7 billion, nearly doubling from €30.4 billion in 2020. With 6,000 European companies operating in India, the economic stakes are high.
The renewed push for an EU-India FTA reflects a mutual desire to counter global uncertainties, particularly Trump’s aggressive trade policies, which have disrupted markets with tariff threats and bilateral deal-making. By deepening ties, the EU and India aim to strengthen their economic resilience and strategic alignment. Trump’s policies, ironically, are accelerating this EU-India rapprochement, as both seek to diversify partnerships in a volatile global economy.
Caption: Maroš Šefcovic, European Commissioner for Trade and Economic Security, and European Commissioner for Interinstitutional Relations and Transparency, receives Piyush Goyal, Indian Minister for Commerce and Industry, Brussels, 23 May 2025. [Europe by Satellite]
Updated: May 27, 2025 - 07:28
