How the India–EU Trade Deal Took Shape After the 2025 US Tariff Shock?

At the World Economic Forum in Davos on January 20, 2026, European Commission President Ursula von der Leyen said the deal was “on the cusp of a historic trade agreement,” signalling readiness to move toward closure. “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. One that would create a market of 2 billion people, accounting for almost a quarter of global GDP," she said. 

India and the European Union formally relaunched negotiations for a comprehensive Free Trade Agreement on June 17, 2022, after talks had remained stalled since 2013. The renewed mandate covered trade in goods and services, investment protection, regulatory cooperation and sustainability-related provisions.

On the Indian side, talks were led by the Department of Commerce, with negotiators supported by officials from the Ministry of External Affairs, Finance Ministry, and sectoral ministries such as Heavy Industries, Steel, Chemicals, Textiles, and Agriculture, depending on the chapter under discussion.

The EU negotiating team was led by the European Commission’s Directorate-General for Trade (DG TRADE), coordinating inputs from EU member states and sector-specific directorates.

At this stage, discussions focused on setting the scope of the agreement, covering trade in goods and services, investment protection, customs cooperation, rules of origin, and regulatory issues.

2023–2024, Multiple Negotiation Rounds Held

Between 2023 and 2024, India and the EU held several rounds of technical negotiations in Brussels and New Delhi, gradually reopening long-pending chapters. Progress was uneven, with convergence in trade facilitation and customs procedures, while issues such as tariffs, standards and services access remained unresolved.

April–August 2025, US Tariffs Alter Global Trade Environment

In 2025, the United States announced higher import tariffs on a range of trading partners, including India, under revised trade measures introduced by President Donald Trump. These tariffs were communicated in phases between April and mid-2025, with implementation timelines extending into August 2025.

Senior officials from both sides acknowledged the need to move negotiations beyond technical discussions and begin addressing politically sensitive chapters through higher-level engagement.

May 2025, Piyush Goyal Steps In To Unblock Negotiations

In May 2025, Commerce and Industry Minister Piyush Goyal travelled to Europe for meetings with senior EU trade leadership, including the EU Trade Commissioner.

These ministerial-level discussions were aimed at providing political guidance to negotiators on key sticking points, particularly industrial tariffs, services commitments and sequencing of tariff reductions. Following these meetings, negotiating teams were asked to accelerate talks and narrow the number of open chapters.

June 2025, Leadership Backing For Faster Conclusion

By June 2025, the negotiations received clear backing at the political leadership level in both India and the EU. Officials were instructed to intensify engagement and move from principle-based discussions to text-based negotiations, especially on market access and rules of origin.

Late October 2025, Ministerial Review in Brussels

On October 27-28, Goyal returned to Brussels for a review meeting with EU trade leadership, particularly Maroš Šefčovič. Discussions during this round focused on tariff schedules for industrial goods, rules of origin, services market access and regulatory cooperation. Technical experts from customs, standards and sectoral ministries participated to address implementation-related concerns.

By the end of the round, negotiators confirmed that a significant number of chapters had either been closed or moved into advanced stages.

Early November 2025, EU Negotiators Visit New Delhi

On 5-6 November 2025, a European Commission negotiating team of Sabine Weyand, Director-General for Trade at the European Commission, held discussions with India’s Commerce Secretary Rajesh Agrawal. 

Meetings during this phase focused on trade in goods, services commitments, rules of origin, and institutional provisions, with negotiators working to consolidate agreed text and reduce brackets in remaining chapters.

December 2025, Final Consolidation Phase Begins

Throughout December 2025, negotiations entered a consolidation phase. Technical teams from both sides worked intensively on finalising text, aligning tariff schedules and resolving sector-specific concerns.

Ministerial oversight continued alongside frequent virtual meetings. 

Early January 2026, Ministerial Talks Intensify

In January 2026, Piyush Goyal made a two-day visit to Brussels (8-9 January), and held high-level dialogues with Commissioner for Trade and Economic Security Maroš Šefčovič.

Discussions centred on narrowing gaps in remaining chapters and aligning timelines for legal review and announcement, ahead of an upcoming India–EU summit.

January 20, 2026, Signal from Davos

At the World Economic Forum in Davos, European Commission President Ursula von der Leyen said the India–EU trade agreement was “on the cusp” of completion, signalling that negotiations had reached a decisive stage.

Late January 2026, Summit-linked Outcome Expected

By late January 2026, officials on both sides indicated that negotiations were nearing completion, subject to final legal checks. The forthcoming India–EU Summit was identified as a potential platform for announcing the conclusion of talks, following which the agreement would move into domestic approval processes.

The European Union is among India’s largest trading partners, with annual bilateral trade exceeding $130 billion. The proposed agreement aims to expand trade across manufacturing, services, technology and clean energy, while providing clearer rules for businesses on both sides.

Also read: ‘Mother of All Deals’: EU Chief Says India–EU FTA Almost Final