
New Delhi: India and the European Union on Friday (February 28) announced a high-level political push to wrap up talks for a free trade agreement (FTA) this year, while both sides also supported the pursuit of a “just” peace to end the Ukraine war, hours before Ukrainian President Volodymyr Zelenskyy visited the White House.>
European Commission President Ursula von der Leyen, accompanied by her full college of commissioners, met with Prime Minister Narendra Modi on the final day of her brief visit, after which they outlined eight “concrete steps”.>
“We have directed our teams to conclude a mutually beneficial Bilateral Free Trade Agreement by the end of this year,” said Modi in his press statement after the discussions.>
For the first time, a deadline has been set for the India-EU FTA, negotiations for which have spanned a total of ten years.>
Talks on a bilateral trade and investment treaty began in 2007 but collapsed in 2013 after 12 rounds, resuming only in July 2022.>
Acknowledging the tight deadline, von der Leyen said, “We are expecting a lot of our trade negotiators, we told them they should surprise us. Now more than ever, the geopolitical context asks for decisive action.”>
While the visit had been in planning for six months, it is currently taking place in the backdrop of US President Donald Trump’s plans to impose import tariffs against his largest trading partners.>
EU officials had said that it would retaliate strongly.>
Earlier at a keynote speech, von der Leyen said the world “was fraught with danger”, which gave more opportunity for Europe and India to “realign their partnership”.>
“But it is because our interests in this hyper-competitive world align more often than not. We both stand to lose from a world of spheres of influence and isolationism. And we both stand to gain from a world of cooperation and working together,” she said, even as she noted that the India-EU FTA “would be the largest deal of this kind anywhere in the world”.>
FTA talks accelerate, but key hurdles remain>
Europe is India’s largest trading partner, with bilateral trade in goods and services reaching approximately $188 billion in 2023. Trade volume has risen by 45% to 50% since 2019, largely due to Brexit.>
However, while the EU accounts for 12.2% of India’s total trade, India makes up only 2.2% of the EU’s trade in goods.>
The European Commission’s report of the last round of India-EU FTA talks in September 2024 said that there had been limited progress in a number of key areas like trade in goods, rules of origin, technical barriers to trade, transparency and government procurement.>
The next round is expected to be held next month.>
A senior EU official accompanying the visit reaffirmed that wines and spirits, and cars must be meaningfully reflected in any trade agreement between the EU and India.>
“I would even go as far as saying that without substantive commitments on cars, there will not be a trade agreement between the European Union and India, and of course our Indian colleagues and counterparts are duly aware of that, but it is up to them to respond to that – and that will be done within the four walls of the negotiating room,” he said.>
The official added that negotiations are proceeding with a clear timeline and a strong level of ambition on the EU’s side. “Our challenge is to align the two – fulfilling our ambitions while meeting the timeline,” he said.>
When Modi had visited Trump in Washington earlier this month, they had also announced that the India-US trade agreement would be concluded this year.>
Along with the FTA, this timeline will also apply to ongoing talks for two agreements on investment protection and geographical indications.>
Besides, both sides also agreed on Friday “to explore a security and defence partnership”.>
After the EU’s adoption of the Strategic Compass just weeks after Russia’s invasion of Ukraine in 2022, it has signed defence and security partnerships with six countries.>
According to the joint statement, India expressed interest in joining defence industrial initiatives under the EU’s Permanent Structured Cooperation and engaging in negotiations for a Security of Information Agreement.>
India, EU endorse ‘just’ peace framework for Ukraine>
At their joint press appearance, neither Modi nor von der Leyen mentioned the Ukraine war. However, the EU president had earlier criticised Russia and highlighted Europe’s concerns over the geopolitical risks of a failed Ukrainian state in her speech on Friday morning.>
“But a failed Ukraine would also intensify the challenges in other parts of the world. Not least in this region. Other countries around the world are watching very closely whether there is any impunity if you invade a neighbour or violate international borders. Or whether there are real deterrents. This is why we want any peace talks to lead to a just and lasting peace,” she said.>
Her remarks appeared to reference the shifting stance in the Trump White House, which has recently leaned towards Russia, straining the transatlantic alliance – a rift most visibly reflected at the United Nations earlier this week.>
The third anniversary of the Ukraine war saw competing amendments from the US and the EU at the UN General Assembly (UNGA). While the EU’s resolution condemning Russia was adopted, the EU also successfully amended the US draft, inserting “just” before “lasting peace” before it was approved.>
India, which has never publicly criticised Russia, abstained from both resolutions at the UNGA.>
The joint statement issued on Friday, endorsed by both Indian and EU leaders, included the European formulation for resolving the Ukraine war.>
“They expressed support for a just and lasting peace in Ukraine based on respect for international law, principles of the UN Charter, and territorial integrity and sovereignty,” the bilateral declaration stated, which did not however mention or criticise Moscow.>
India and the EU’s declaration came just ahead of Zelenskyy’s first meeting with Trump at the White House, which turned confrontational. While the Ukrainian leader arrived to sign a deal granting access to critical mineral resources in exchange for US support, the meeting took a tense turn, with Trump calling Zelenskyy “disrespectful” for pressing on security guarantees.>
In a clear response to the Trump administration’s threats of abandoning security guarantees, von der Leyen said in New Delhi that Europe was “ready to live up to its responsibility when it comes to security and defence”.>
Positioning the EU’s proposed defence and security partnership with India within this context, von der Leyen said,>
“We will step up our defence spending to ensure that member states have access to the full spectrum of capabilities that this new reality demands. But we also want to step up cooperation with crucial partners like India. This is why I can announce that we are exploring a future Security and Defence Partnership with India, similar to the partnerships we have with Japan and South Korea.”>
The Indian prime minister highlighted that both of them agreed “on the importance of peace, security, stability and prosperity in the Indo-Pacific region”.>
“We welcome the decision of the EU to join the “Indo Pacific Oceans Initiative”. We will work together on Triangular Development projects for sustainable and inclusive development in the Indo-Pacific region and Africa,” stated Modi.>
The India-EU joint statement also mentioned that the two sides reiterated their “commitment to the vision of the two-state solution with Israel and Palestine living side by side in peace and security within recognised borders, consistent with international law”.>
This stands as India’s highest-level reaffirmation of the two-state solution since Trump’s proposal to relocate Palestinians from Gaza.>