The EU and India have signed one of the largest trade agreements in the world
On 27 January, the European Union and India announced the conclusion of negotiations and the achievement of a free trade agreement, which the parties call the mother of all agreements. According to international agencies, this is one of the largest trade agreements in the world in terms of population and economic potential, reports DW.
Indian Prime Minister Narendra Modi said the new agreement opens up significant opportunities for the economies of both sides. According to him, the EU and India together account for about 25 per cent of global gross domestic product and a third of global trade. European Commission President Ursula von der Leyen emphasised that the agreement sends a signal to the world about the effectiveness of rules-based cooperation between the world's largest democracies.
Under the terms of the agreement, India will reduce or completely eliminate tariffs on nearly 97 per cent of European exports. In response, the European Union will reduce tariffs on approximately 99 per cent of goods from India. The EU will open its market to Indian seafood, textiles, leather goods, chemical products, non-ferrous metals, precious stones and jewellery. At the same time, a number of agricultural products, including beef, rice, sugar and dairy products, remain outside the scope of the agreement.
India, in turn, has agreed to gradually reduce import duties on European cars from 110 per cent to 10 per cent, creating new opportunities for manufacturers such as Volkswagen, Renault, Mercedes Benz and BMW. An immediate reduction in tariffs on alcoholic beverages, including wine, is also planned.
At the end of the 2024 and 2025 financial years, trade between India and the EU amounted to $136.5 billion. It is expected that once the agreement comes into force, this figure could rise to around $200 billion by 2030. The official signing of the document is scheduled after the completion of legal harmonisation, and the agreement is expected to come into force in early 2027.
Source and photo: DW.
Indian Prime Minister Narendra Modi, EU, European Union, India, European Commission President Ursula von der Leyen
