An India-EU summit is set to take place later this year, marking a significant step toward strengthening bilateral ties. The European Union, India's largest trading partner in goods, reached a bilateral trade volume of $135 billion during 2022-23. The EU's interest in deepening its presence in India is evident, with approximately 6,000 European companies currently operating within the country.
Both India and the EU are keen on enhancing cooperation in security and stability. They are exploring the possibility of a 'Security and Defence Partnership' akin to existing agreements with Japan and South Korea. If realized, this could become the largest deal of its kind globally. Talks surrounding a long-pending free trade agreement were relaunched in 2021, with another round scheduled for March. However, despite ongoing negotiations, tangible progress remains limited.
India's approach to free trade has evolved, with the nation actively engaging in agreements and discussions with various countries and economic blocs. This marks a shift from previous years of scepticism. Meanwhile, the EU seeks to expand its influence in the Indo-Pacific region amid trade tensions with the US and differing stances on Ukraine.
Ursula von der Leyen, the EU Commission chief, is currently visiting India along with the entire College of Commissioners, underscoring the significance of this diplomatic engagement. This marks the first such visit following the European Parliamentary elections in June 2024.
"I am well aware it will not be easy. But I also know that timing and determination counts." – Ursula von der Leyen
India recently signed a $100 billion free trade agreement with the European Free Trade Association (EFTA), concluding nearly 16 years of negotiations. This achievement highlights India's renewed focus on forging international trade relationships. The EU and India aim to deepen collaboration in sectors such as semiconductors, artificial intelligence, and cleantech, which are seen as pivotal for future economic growth.