New blueprint for shared prosperity: PM Narendra Modi on India-EU trade deal

INdia and the European unification (EU) on tues proclaimed the ratiocination of a release trade agreement billed as the “mother of all deals”, with Prime Minister Narendra Modi and the top EU leadership unveiling a broad vision for using commerce to bolster a rules-based world order and to deepen security cooperation.Modi met European Council President Antonio Costa and European Commission President Ursula von der Leyen for the India-EU Summit a day after the EU leaders participated in the Republic Day celebrations – a signal honour reserved for the country’s closest strategic partners.“Today India has concluded the largest free trade agreement in its history. Today is January 27, and it is a happy coincidence that on this day, India is concluding this FTA with 27 countries of the European Union,” Modi said at a joint media interaction with the EU leaders.Describing the trade deal, which is expected to be formally signed and ratified later this year, as a “new blueprint for shared prosperity”, Modi said: “This historic agreement will facilitate access to the European market for our farmers and small industries, create new opportunities in manufacturing, and further strengthen cooperation between our services sectors.India-EU trade deal LIVE:‘We did it,’ Europe’s Ursula von der Leyen tells PM Modi on India-EU trade deal“Furthermore, this FTA will boost investment between India and the EU, create new innovation partnerships, and strengthen supply chains globally.”Von der Leyen, who had along with Modi set the target for concluding the FTA talks by the end of 2025, said: “Prime Minister, distinguished friend, we did it. We delivered the mother of all deals. We are creating a market of two billion people. And this is the tale of two giants, the world’s second and fourth largest economies, who choose partnership in a true win-win fashion, a strong message that cooperation is the best answer to global challenges.”She added, “This trade will integrate further our supply chains and strengthen our joint manufacturing power. It will cut up to €4 billion in annual tariffs for exporters of all sizes and it will create good jobs for millions of workers here in India and in Europe.”While none of the leaders directly referred to the disruptions caused by the trade policies of the US, they all emphasised the need for India and the EU to stand together in confronting the challenges of a global environment in churn. “The global order is in great turmoil today. In such a context, the partnership between India and the EU will strengthen stability in the international system,” said Modi, who spoke in Hindi.Von der Leyen said the two sides, by combining their strengths, will “reduce strategic dependencies at a time when trade is increasingly weaponised”.India-EU trade was worth $136.5 billion in the fiscal year through March 2025. The EU is currently India’s largest trading partner, and accounted for trade in goods worth €120 billion in 2024, or 11.5% of India’s total trade. Trade in services was worth €59.7 billion in 2023. Once the FTA is ratified by the European Parliament, a process that could take at least a year, the agreement could expand bilateral trade and lift Indian exports such as textiles and jewellery, which have been hit by 50% US tariffs since last year.Besides a political declaration on the conclusion of negotiations for the FTA, the two sides inked a Security and Defence Partnership that will deepen cooperation in counter-terrorism, maritime security and cyber security and open the doors for defence industrial cooperation, especially for the co-development and co-production of military hardware at a time when many EU member states have launched programmes for revitalising their defence amid the fraying of security guarantees provided by the US.The two sides also finalised a comprehensive framework for cooperation on mobility to facilitate the movement of Indian students, researchers, and seasonal and highly skilled workers. The EU will launch its first Legal Gateway Office in India to serve as a one-stop hub to support Indian talent moving to Europe in alignment with the needs and policies of EU member states.The two sides also unveiled a new comprehensive strategic agenda or roadmap to drive their partnership over the next five years.Costa, who traces his roots to Goa and proudly displayed his Overseas Citizen of India document at the media interaction, said the India-EU Summit is sending a message to the world at a time when the global order is being reshaped that the two sides “stand together as strategic and reliable partners”.“Today, we are taking our partnership to the next level. As the two largest democracies in the world, we are working hand-in-hand to deliver concrete benefits for our citizens and to shape a resilient global order that underpins peace and stability, economic growth and sustainable development,” he said.Costa added, “Trade agreements reinforce rules-based economic order and promote shared prosperity. That’s why today’s free trade agreement is of historic importance – one of the most ambitious agreements ever concluded, creating a market of two billion.”The EU and India, he said, also share the responsibility of upholding international law with the UN Charter at its core. “Together, we must show leadership on global issues. Cooperation between the EU and India will help shape a more balanced, resilient and inclusive global order,” he said, while noting that the EU can count on Modi to help in creating conditions for peace in Ukraine through dialogue and diplomacy.Modi said new Security and Defence Partnership will deepen cooperation in counter-terrorism, maritime security and cyber security, and simultaneously strengthen the shared commitment to a rules-based international order. “The scope of our cooperation in the Indo-Pacific region will expand. With this, our defence companies will realise new opportunities for co-development and co-production,” he said.Von der Leyen described the security pact as a “landmark departure and a trust-based platform” for cooperation on key strategic issues that will help build each other’s resilience. Besides more joint naval exercises to tackle piracy, the two sides will step up work on countering cyber and hybrid threats and take forward a dialogue on space security and also launch negotiations for a Security of Information Agreement, she said.The three leaders also reiterated the commitment of India and the EU to the India-Middle East-Europe Economic Corridor (IMEC) to bolster global and regional connectivity.