The European Commission has proposed that the European Union approve and conclude its free-trade agreement with India, bringing the long-awaited pact closer to taking effect.
Once approved, the agreement would be the largest trade deal ever concluded by either the EU or India, the European Commission said Friday.
The pact would remove or reduce tariffs on 96% of EU goods exports to India, saving European exporters about €4 billion a year in customs duties. It is also designed to expand market access, reduce trade barriers and provide businesses with more predictable regulatory rules.
The EU and India began negotiating the agreement in 2007, but talks were suspended in 2013. Negotiations resumed in 2022 and were concluded in January 2026.
The agreement could take effect by the end of this year or in the first half of 2027. Under the EU’s ratification process, the European Commission’s proposal must first be authorised by the Council of the EU and then receive the European Parliament’s consent. India is also advancing its own domestic approval process.
The proposal comes as the EU seeks to speed up trade agreements amid rising geopolitical tensions and growing pressure on global commerce.
Trade in goods and services between the EU and India now exceeds €180 billion a year, supporting nearly 800,000 jobs in the bloc, according to the European Commission.
India is the EU’s ninth-largest trading partner for goods. Two-way merchandise trade reached €118 billion in 2025, with machinery, transport equipment and chemicals accounting for much of the EU’s exports to India. India’s main exports to the EU include machinery, chemicals, textiles, metals and refined petroleum products.
Trade in services totalled €67 billion in 2025. EU imports of services from India stood at €37.8 billion, while exports to India were €29.2 billion.
Investment ties are also significant. EU foreign direct investment stock in India stood at €132.8 billion in 2024, compared with €13.7 billion of Indian FDI stock in the EU.
The EU and India are also negotiating separate agreements covering geographical indications and investment protection.
India currently receives tariff benefits on some exports under the EU’s Generalised Scheme of Preferences. However, as Indian industries have become more competitive, several sectors have graduated from the scheme, leaving about 38% of India’s exports to the EU eligible for preferential tariffs.
