India-EU Trade Deal Likely Next Week: Five Things To Expect From The Mother of All Deals

Ahead of EU Chief Ursula von der Leyen's visit to India, Dalal street's anticipation have surged over the positive triggers that the likely signing of India-EU Free Trade Agreement would set in motion.

Addressing a gathering at Davos 2026, European Commission President Ursula von der Leyen, said the EU was working to deepen its strategic and economic partnership with India and was on the cusp of inking a trade deal.

In 2025, India’s bilateral trade with the EU stood nearly at $130 billion with the south Asian nation exporting an annualised $75 billion worth of goods to the EU in 2025, and imports stood at about $65 billion, leaving a $10–15 billion trade surplus, mainly led by surging electronics shipments, and petroleum product exports, according to a Jefferies note.

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5 Key Sectoral Expectations From India-EU FTA

After decades of negotiations, brokerage house Jefferies expects economic impact to be concentrated in industrial goods and services rather than farm-linked verticals.

Sectors like autos, chemicals, electronics, pharmaceuticals and textiles in India are expected to be top beneficiaries of the India–EU free trade agreement.

In auto sector, Jefferies notes that while the EU is pushing for lower import tariffs — which can go as high as 100% the impact on Indian OEMs may be limited.

Indian exporters currently face tariffs of up to 10%, while competitors such as Bangladesh and Pakistan enjoy zero-duty access. An FTA could level the playing field, especially at a time when US tariffs have sharply increased.

Meanwhile, the EU is expected to gain improved access for its luxury vehicles, alcoholic beverages, and high-end fashion labels. 

Once inked, and ratified by the European Parliament, the. process that could take at least a year. This bilateral trade pact could expand trade, and lift Indian exports, which have been affected by 50% US tariffs since August, 2024.