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‘Mother of all deals’ with India almost sealed: EU leader ahead of R-Day summit with Modi
European Commission President Ursula von der Leyen said at World Economic Forum in Davos that combined EE-India market will account for a quarter of global GDP
India and the European Union are on the cusp of a "historic trade agreement" that would create a market comprising 2 billion people, European Commission President Ursula von der Leyen said on Tuesday in an address at the World Economic Forum in Davos. This market would thus account for almost a quarter of the global GDP, she added.
The remark came days before her trip to Delhi.
“I will travel to India. There is still work to do. But we are on the cusp of a historic trade agreement. Some call it the mother of all deals,” she said.
Her underlining of the scale of the deal comes at a time when US President Donald Trump has been using tariffs against India and European countries to force them into positions that he prefers.
"It is time to seize this opportunity and build a new independent Europe," said von der Leyen, mentioning current "geopolitical shocks" and how the 27-nation bloc is responding.
President of the European Council Antonio Costa and von der Leyen will be in India from January 25 to 27 as Republic Day chief guests, and hold summit talks with Prime Minister Narendra Modi.
The two sides are set to announce the conclusion of negotiations on the much-awaited Free Trade Agreement at the India-EU summit on January 27.
"And, crucially, that would provide a first-mover advantage for Europe with one of the world's fastest growing and most dynamic continents," von der Leyen said, explaining that Europe wants to do business with the growth centres of today and the economic powerhouses of this century.
"From Latin America to the Indo Pacific and far beyond, Europe will always choose the world. And the world is ready to choose Europe," she said in her televised address.
What FTA means for India, EU
- The European Union is already India's biggest trade partner with bilateral trade in goods recording $135 billion in the financial year 2023-24.
- The Free Trade Agreement is expected to significantly enhance these ties. The EU and India had first launched negotiations for the free trade agreement in 2007, before the talks were suspended in 2013 due to a gap in ambition. The negotiations. The negotiations were relaunched in June 2022.
- The ambitious FTA is being firmed up at a time amid increasing concerns over Trump-ruled Washington's trade and tariff policies which have impacted both India and the 27-nation EU. "The world may be very different today, without any question. But I believe the lesson is very much the same. That geopolitical shocks can — and must — serve as an opportunity for Europe," Ursula von der Leyen said.
Defence pact on agenda too
Besides the FTA, the two sides are likely to unveil a defence framework pact and a strategic agenda at the January 25-27 summit. India and the European Union have been strategic partners since 2004.
The joint comprehensive strategic vision that will govern their relationship for the period 2026-2030.
In her address, von der Leyen also touched upon geopolitical challenges over, for instance, Greenland. "In my view, the seismic change we are going through today is an opportunity, in fact, a necessity to build a new form of European independence. This need is neither new nor a reaction to recent events," she said.
"We will only be able to capitalise on this opportunity if we recognise that this change is permanent," she said.
What she said on US ties
On the EU's ties with the US, von der Leyen said Europe considers American people not just "our allies, but our friends".
"And plunging us into a dangerous downward spiral would only aid the very adversaries we are both so committed to keeping out of the strategic landscape," she said.
"But beyond this, we have to be strategic about how we approach this issue," said the top EU leader, referring to the Russia-Ukraine war.
"In just over a month, we will mark the fourth anniversary of Russia's war of aggression against Ukraine. Four years on, Russia shows no sign of abating. No sign of remorse. No sign of seeking peace," she said.
"This must end. We all want peace for Ukraine. We recognise President Trump's role in pushing the peace process forward, and we will work closely with the United States. We all agree that Ukraine must therefore be in a position of strength to go to the negotiation table," she said.
(with PTI inputs)
