European Commission President Ursula von der Leyen on Tuesday said the European Union is close to finalising a long-awaited free trade agreement with India, describing the proposed pact as potentially “the mother of all deals” during her address at the World Economic Forum in Davos. While acknowledging that some issues remain unresolved, she said negotiations have reached a decisive stage.
Speaking at the global summit, von der Leyen emphasised the scale and significance of the proposed agreement, noting that it would create a combined market of nearly two billion people and account for almost a quarter of global gross domestic product. “There is still work to do. But we are on the cusp of a historic trade agreement,” she said, underscoring the economic and strategic importance of the deal for both sides.
The proposed free trade agreement is expected to deepen economic ties between India and the European Union by reducing trade barriers, improving market access, and strengthening cooperation across key sectors such as manufacturing, digital services, clean energy, and supply chains. If concluded, it would be among the largest trade agreements ever negotiated by the EU.
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Trade talks between India and the EU were relaunched in recent years after a prolonged pause, with both sides aiming to reflect changing global economic realities and geopolitical priorities. The negotiations have focused on sensitive areas, including tariffs, investment protection, sustainability standards, and regulatory alignment, which have historically slowed progress.
Von der Leyen also indicated that diplomatic engagement between the two partners is set to intensify, with her expected to visit India early next week. The visit is seen as a signal of political commitment at the highest level to push the agreement toward completion.
If finalised, the India-EU trade deal could significantly reshape global trade flows and reinforce strategic cooperation between the two economies at a time of growing uncertainty in international markets, positioning both partners more strongly within the evolving global economic order.
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