Sunday, 1 February 2026
The European Union and India have concluded a comprehensive free trade agreement, marking a significant step in strengthening economic relations between the two markets after negotiations that began in 2007 and were repeatedly suspended.
According to Sonali Chowdhry, trade expert at DIW Berlin, the agreement comes at a strategically important moment for both sides. India is expected to maintain strong economic growth in the coming years and is projected to become one of the world’s three largest economies by the end of the decade, increasing the importance of EU access to the Indian market.
Trade relations between the European Union and India are already extensive, with more than 170,000 buyer-supplier relationships between companies on both sides. The agreement aims to deepen these ties by reducing tariffs and non-tariff barriers across a range of sectors.
For EU exporters, the deal is expected to improve market access in industries such as automotive, engineering and beverages. At the same time, Indian exports including pharmaceuticals, IT services and textiles are set to benefit from improved access to the EU market.
Beyond direct trade effects, Chowdhry notes that the agreement also has a broader systemic role. By establishing binding commitments on transparency and market access, the agreement is intended to enhance predictability in international trade at a time when global trade rules are increasingly under pressure. In this context, the EU–India agreement is seen as a counterweight to rising protectionist trends and a measure to support the stability of the global trading system.
Source: DIW Berlin
