NEW DELHI
\nIndia and the European Union announced Tuesday the \u201cmother of all deals\u201d, a huge trade pact to create a market of two billion people, reached after two decades of negotiations. EU chiefs and Prime Minister Narendra Modi hope the pact will help shield against challenges from the world\u2019s two leading economies, the United States and China.
\nThe agreement will cut or eliminate tariffs on almost 97% of European exports, saving up to \u20ac4 billion ($4.75 billion) annually in duties, the 27-nation bloc said. \u201cA mother of all deals,\u201d Modi said Tuesday in the capital New Delhi, where he met with European Commission President Ursula von der Leyen and European Council President Antonio Costa.
\n\u201cThis deal will bring many opportunities for India\u2019s 1.4 billion and many millions of people of the EU,\u201d Modi said, adding the agreement \u201crepresents about 25% of global GDP, and one-third of global trade\u201d. The EU has eyed India \u2014 the world\u2019s most populous nation \u2014 as an important market for the future.
\n\u201cEurope and India are making history today,\u201d von der Leyen said in a statement, a day after she and Costa were feted as guests of honour at India\u06d4s Republic Day parade. \u201cWe have created a free trade zone of two billion people, with both sides set to benefit.\u201d EU officials said the deal was the most ambitious India had ever signed, and European companies would benefit from the so-called \u201cfirst mover advantage\u201d.
\nEurope\u2019s key agricultural, automotive and service sectors stand to gain.New Delhi sees the European bloc as an important source of much-needed technology and investment to rapidly upscale its infrastructure and create millions of new jobs. Bilateral trade in goods reached \u20ac120 billion ($139 billion) in 2024, an increase of nearly 90% over the past decade, according to EU figures, with a further \u20ac60 billion ($69 billion) in trade in services.
\nUnder the agreement, India is expected to ease market access for key European products.Tariffs on cars will be gradually lowered from a top rate of 110% to as low as 10%, while duties on wines progressively go down from 150% to as low as 20%. Currently at 50%, tariffs on processed foods \u2014 including pasta and chocolate \u2014 will be eliminated, according to the EU.
\nVon der Leyen said she expected exports to India to double, and that the EU would \u201cgain the highest level of access ever granted to a trade partner in the traditionally protected Indian market\u201d. European firms will get privileged access to the Indian financial services and maritime transport market, the bloc said.
\nFor India, it would boost sectors including textiles, gems and jewellery, and leather goods, as well as the service sector, Modi said.
\nTalks went down to the wire on Monday, focusing on a few sticking points, including the impact of the EU\u2019s carbon border tax on steel, according to sources familiar with the discussions.The accord comes as both Brussels and New Delhi have sought to open up new markets in the face of US tariffs and Chinese export controls.
\nIndia and the EU were also expected to conclude an accord to facilitate movement for seasonal workers, students, researchers and highly skilled professionals, and a security and defence pact.
\n\u201cIndia and Europe have made a clear choice. The choice of strategic partnership, dialogue and openness,\u201d von der Leyen wrote on social media. \u201cWe are showing a fractured world that another way is possible.\u201d
\nIndia is on track to become the fourth-largest economy this year, according to International Monetary Fund projections. New Delhi, which has relied on Moscow for key military hardware for decades, has tried to cut its dependence on Russia in recent years by diversifying imports and pushing its own domestic manufacturing base. Europe is doing the same with regard to the US. \u2014 DNA<\/p>\n","protected":false},"excerpt":{"rendered":"
NEW DELHI India and the European Union announced Tuesday the \u201cmother of all deals\u201d, a huge trade pact to create a market of two billion people, reached after two decades of negotiations. EU chiefs and Prime Minister Narendra Modi hope the pact will help shield against challenges from the world\u2019s two leading economies, the United […]<\/p>\n","protected":false},"author":2,"featured_media":528094,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[],"class_list":["post-528075","post","type-post","status-publish","format-standard","has-post-thumbnail","category-world"],"yoast_head":"\n