Business & Economics
India-EU Seal Record-Size FTA, Ending 19-Year Negotiations
On 27 Jan 2026 New Delhi and Brussels formally closed talks on a free-trade pact that will wipe out most tariffs once ratified, creating a market of two billion people.
Focusing Facts
- Commerce Minister Piyush Goyal and EU Trade Commissioner Maroš Šefčovič exchanged a political declaration concluding the FTA negotiations at an India-EU summit in Delhi on 27 Jan 2026.
- The accord eliminates duties on 96.8 % of EU tariff lines for Indian exports on day-one and phases out tariffs on 97 % of EU exports to India, aiming to cut €4 billion in annual duties.
- Import duties on fully-built cars will fall from up to 110 % to 10 % over ten years, while wine tariffs drop from 150 % to 20 %.
Context
Major North-South trade pacts are rare; the last of comparable scale was NAFTA’s launch in 1994, which stitched together asymmetric economies to lock in supply-chain integration. Europe’s pivot to India echoes its 1973 search for new markets after the first oil shock, but now energy security, Chinese over-reliance, and the weaponisation of tariffs (e.g., U.S. Section 232 in 2018) push Brussels toward diversification. For India, the deal caps two decades of stalled talks and mirrors the 2001 WTO accession of China that turbo-charged its exports; Delhi hopes for a similar manufacturing boom without ceding policy space on agriculture and carbon taxes. If the pact survives ratification battles in 27 parliaments and delivers the promised €200 billion trade by 2030, it could anchor a multipolar trade order where medium powers hedge between Washington and Beijing—an inflection that historians in 2126 may see as the moment the Indo-European corridor crystallised.
Perspectives
Indian government-aligned outlets
e.g., ANI, News18, Hindustan Times, NDTV — They cast the India-EU FTA as a historic, "mother of all deals" that will create jobs, open markets for Indian farmers and small industries, and showcase Prime Minister Modi’s leadership. Echoing official talking points, these reports lavish praise on Indian negotiators while skimming over contentious issues like CBAM exemptions or sectors kept outside the pact. ( Asian News International (ANI) , News18 )
Indian financial press and trade think-tank voices
e.g., Economic Times, @businessline quoting GTRI — They argue the pact will lower input costs, deepen value-chain integration and expand two-way trade without threatening domestic industry because India and the EU sit on “different rungs of the value chain.” By leaning heavily on a single pro-trade think tank and emphasising classic FTA gains, they underplay possible labour dislocation or environmental frictions flagged elsewhere.
Regional/editorial commentators emphasising implementation risks
e.g., Telangana Today, ThePrint — They hail the agreement’s geopolitical heft but stress that its real impact hinges on post-signing execution, government support beyond tariff cuts, and resolving issues like CBAM and steel quotas. Framing the deal as a global realignment narrative allows them to sound visionary yet sidestep granular cost-benefit analysis for vulnerable domestic sectors.