India and the European Union have set a year-end target to sign their landmark free trade agreement, with both sides accelerating efforts to finalise one of the world’s largest trade pacts amid growing geopolitical and economic uncertainties.
European Commission President Ursula von der Leyen shared the update on X after meeting with Prime Minister Narendra Modi and European Council President Antonio Costa on the sidelines of the G7 Summit in France.
The proposed agreement, often described as the “Mother of All Deals”, is expected to deepen economic integration between India and the EU while creating fresh opportunities for trade, investment and supply-chain diversification.
Trade deal expected to unlock major economic opportunities
The India-EU FTA was formally concluded in January this year following negotiations that covered goods, services and digital trade.
The agreement is expected to cover nearly a quarter of the global economy and significantly lower trade barriers between the two partners.
According to officials, the pact will remove tariffs on 99 per cent of Indian exports to the European Union while reducing duties on more than 97 per cent of European exports entering India.
European estimates suggest the agreement could save exporters from the bloc nearly four billion euros annually in tariffs.
“Since we have concluded the mother of all trade deals, we have been moving fast to deliver on our commitments. We will sign the Free Trade Agreement by the end of the year. And accelerate work on an investment agreement,” Von der Leyen said on social media.
“We will also step up security & defence cooperation. And join forces for better connectivity by advancing IMEC, the India–Middle East–Europe Corridor,” she said.
Costa shared an identical message following the meeting.
Prime Minister Modi also described the discussions as another step forward in strengthening India-EU relations.
“At the start of this year, India was proud to host them for our Republic Day celebrations. This has been a great time for India-EU ties as we have concluded the Free Trade Agreement,” he said on social media.
“During our talks, we discussed how to further deepen economic linkages in the times to come. Our growing cooperation can play an important role in strengthening peace, stability and prosperity in today’s global environment,” he added.
Defence, connectivity and global issues also discussed
The Ministry of External Affairs said the leaders reviewed progress made since the 16th India-EU Summit held in New Delhi earlier this year and welcomed the momentum in bilateral cooperation.
Officials said both sides stressed the importance of signing and implementing the agreement quickly, particularly at a time when countries are seeking more resilient and diversified supply chains.
The leaders also reviewed progress on the Joint India-EU Comprehensive Strategic Agenda adopted in January and discussed ways to expand cooperation in connectivity, security and defence.
India and the EU also exchanged views on developments in West Asia and welcomed ongoing diplomatic efforts aimed at reducing regional tensions.
The MEA said both sides reiterated their commitment to building a resilient multipolar world order that promotes peace, stability, sustainable development and economic prosperity.
The European Union remains India’s largest trading partner in goods. Bilateral merchandise trade stood at around $136 billion in FY25, with Indian exports accounting for nearly $76 billion and imports from the bloc at about $60 billion.