After many false starts, the India-European Union Free Trade Agreement (FTA) talks finally concluded on Monday. Commerce Secretary Rajesh Agrawal on Monday said that the formal implementation of the deal is likely to happen next year. “Negotiations have been successfully concluded. The deal has been finalised,” he said.
Commerce ministry sources said that while the deal will be announced on Tuesday, processes like legal scrubbing, signing and most importantly ratification by EU member states may take another year. This is the fourth FTA India has signed since 2025. Last year, it concluded trade agreements with the UK, New Zealand and Oman.
The deal was closed in the presence of European Council President António Costa and European Commission President Ursula von der Leyen, who have come to India as special guests during the Republic Day celebrations. “Their presence underscores the growing strength of the India-EU partnership and our commitment to shared values. The visit will add momentum to the deepening engagement and cooperation between India and Europe across diverse sectors,” said Prime Minister Narendra Modi in his social media post.
Both sides have hinted that they are on the verge of concluding the negotiations, and the formal signing will take place on Tuesday. Described as the ‘mother of all deals’ by the Commerce Minister Piyush Goyal, India EU FTA will be signed after nearly two decades of talks, which began as early as 2007. However, the talks were suspended in 2013 as both sides opted for certain protectionist measures. The negotiations were relaunched in June 2022.
“The European Union remains a vital economic & strategic partner for India, and we value our shared commitment to a mutually beneficial, ambitious India-EU FTA for the prosperity of our businesses and people,” Piyush Goyal stated in his social media post.
As confirmed by the Ministry of Commerce, both sides have agreed to keep certain sensitive sectors out of the trade deal. India has maintained its protectionist stance for the dairy and agricultural sectors.
"A successful India makes the world more stable, prosperous and secure. And we all benefit," Von der Leyen said on Monday. She even said that the engagement between India and the EU “will culminate tomorrow in the signature of our Security and Defence Partnership”.
India has a trade surplus with the EU, which stood at nearly $15 billion in FY2025, with exports of $75.9 billion against imports of $60.7 billion. The EU accounts for about 17% of India's total goods exports and one-third of its IT services exports.
According to some analysts, the FTA is estimated to boost India’s exports to the region by over 50% in the next five years.
According to the Global Trade Research Initiative (GTRI), India and EU are not rivals but partners operating on different rungs of the value chain. While India exports labour-intensive, downstream and processing-based goods, while the European Union supplies capital goods, advanced technology and industrial inputs.
“This structural complementarity explains why an India–EU free trade agreement is likely to lower costs and expand trade rather than threaten domestic industry,” it said in a note.