India, EU push to seal free trade deal by year-end

India and the European Union (EU) are racing against time to finalize a free trade agreement (FTA) by the end of the year, with both sides ramping up efforts to strike a balanced and mutually beneficial deal.

Commerce and Industry Minister Piyush Goyal met with EU Commissioner for Trade and Economic Security Maros Sefcovic in Mumbai on March 1, alongside officials from both sides, to accelerate negotiations.

“Our discussions focused on fast-tracking efforts towards a balanced and mutually beneficial free trade agreement. Looking forward to deepening economic ties and fostering a prosperous India-EU partnership,” Goyal said in a post on X.

The urgency comes after Prime Minister Narendra Modi and European Commission President Ursula von der Leyen, in a recent meeting on Feb 28, reaffirmed their commitment to sealing the long-awaited trade pact this year. Their push for a deal also follows rising concerns over potential tariff hikes under former US President Donald Trump’s trade policies, should he return to office.

Negotiators are set to hold the tenth round of FTA talks from March 10-14 in Brussels, as both sides aim to resolve lingering differences. Talks had previously stalled for over eight years, resuming only in June 2022 after being put on hold in 2013 due to market access disagreements.

A successful deal could make Indian exports—ranging from garments and pharmaceuticals to steel, petroleum products, and electrical machinery—more competitive in the EU market. India is also pushing for data security status for its IT sector, which would allow the transfer of sensitive data and unlock significant opportunities for Indian tech firms.

Currently, the EU is India’s largest trading partner for goods, with bilateral trade reaching $137.41 billion in 2023-24. Indian exports to the EU stood at $75.92 billion, while imports were valued at $61.48 billion. Additionally, India-EU trade in services was estimated at $51.45 billion in 2023.

The FTA negotiations also cover an investment protection agreement and an agreement on geographical indications (GIs). The EU has already invested over $117 billion in India, with around 6,000 European companies operating in the country. Meanwhile, Indian investments in the EU stand at approximately $40 billion.

With India emerging as the world’s fastest-growing major economy — projected to expand at 6.4% in 2024-25 — the deal holds significant promise for both sides. Now, it’s a race against time to finalize an agreement that could reshape India-EU economic ties for years to come.