Modi Says India, EU Agree on Trade Pact After Two Decades of Talks

Summary

India and the European Union have concluded a free trade agreement after nearly two decades of talks, with Prime Minister Modi calling it significant. The deal aims to lower tariffs on most goods, giving EU companies better access to the Indian market, especially for machinery and cars, while India seeks to export textiles and minerals to the EU. Oliver Crook explains the timing is driven by global trade uncertainty under President Trump and the EU's push to diversify away from the US and China. Allianz estimates the deal could boost EU exports to India by $20 billion and European GDP by 10 basis points annually.

• India and the EU agree on a free trade deal after 20 years of negotiations.
• The pact lowers tariffs on most consumer and industrial goods, with some agricultural exclusions.
• EU companies hope to gain access to India's market, particularly for machinery and automobiles.
• India aims to increase exports of textiles and minerals to the European Union.
• A separate security and defence pact could shift some Indian military purchases toward Europe.
• The timing reflects EU and Indian pragmatism amid US tariff uncertainty and a desire to diversify from the US and China.
• Allianz estimates the deal could increase EU exports to India by about $20 billion and EU GDP by 10 basis points.
• The agreement is seen as a significant step forward, though less expansive than the EU-Mercosur deal.