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India and the EU are on the verge of a “mother of all deals,” creating a market of 2 billion people and reshaping global trade. With Republic Day talks with Modi imminent, the world waits to see how this historic pact could shift economic and strategic alliances.
EU leader ahead of R-Day summit with Modi
New Delhi: India and the European Union are on the verge of finalising a landmark free trade agreement that could reshape global commerce, European Commission President Ursula von der Leyen said on Tuesday, just days before her visit to India for the Republic Day summit with Prime Minister Narendra Modi.
Speaking at the World Economic Forum in Davos, von der Leyen described the proposed pact as a “historic trade agreement”, adding that it would create a combined market of nearly two billion people and account for almost one-fourth of global GDP. “Some call it the mother of all deals,” she remarked, signalling that negotiations are close to completion.
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Von der Leyen and European Council President Antonio Costa will travel to India from January 25 to 27 as chief guests for Republic Day celebrations. During the visit, they are expected to hold summit-level talks with Prime Minister Modi, where the conclusion of the long-pending India-EU Free Trade Agreement (FTA) is likely to be formally announced on January 27.
Highlighting the strategic importance of the pact, von der Leyen said the agreement would give Europe a “first-mover advantage” with one of the world’s fastest-growing economies. “Europe wants to do business with the growth centres of today and the economic powerhouses of this century,” she noted.
The European Union is already India’s largest trading partner, with bilateral goods trade touching $135 billion in the 2023–24 financial year. Talks on the FTA were first launched in 2007 but stalled in 2013 due to differences in ambition. Negotiations resumed in June 2022 amid shifting global economic and geopolitical realities.
The renewed momentum comes as both India and the EU face uncertainty from protectionist trade policies and tariff pressures emanating from the United States under President Donald Trump.
Beyond trade, the upcoming summit is expected to unveil a defence cooperation framework and a comprehensive strategic vision for the 2026–2030 period. India and the EU have been strategic partners since 2004, and officials see the new agenda as a step toward deeper political and security cooperation.
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Von der Leyen stressed that current geopolitical shocks should be viewed as an opportunity for Europe to build greater strategic independence, while remaining open to global partnerships, particularly in the Indo-Pacific.
Addressing transatlantic relations, von der Leyen said Europe continues to view the United States as a close ally and friend, cautioning against actions that could weaken collective security. On Ukraine, she reiterated support for a peace process, noting that Kyiv must negotiate from a position of strength and that Europe would work closely with Washington to achieve lasting stability.
The India visit, she suggested, would mark a decisive step in shaping Europe’s long-term global partnerships.
