India and EU finalise landmark trade deal: Modi

India and the European Union have finalised a landmark free trade agreement that will cover around a quarter of the global economy, Prime Minister Narendra Modi said on Tuesday, as both sides look to reduce their reliance on uncertain ties with the United States.

After nearly two decades of intermittent negotiations, the agreement will open India’s vast and traditionally protected market to freer trade with the 27-nation European Union, India’s largest trading partner.

“Yesterday, a big agreement was signed between the European Union and India,” Modi said. “People around the world are calling this the mother of all deals. This agreement will bring major opportunities for the 1.4 billion people of India and the millions of people in Europe.”

Modi added that the deal represents about 25 percent of global gross domestic product and nearly one-third of global trade.

Modi and European Commission President Ursula von der Leyen are expected to jointly announce the agreement and outline its key provisions later on Tuesday at an India–EU summit in New Delhi.

Bilateral trade between India and the EU totaled $136.5 billion in the fiscal year ending in March 2025.

The agreement comes just days after the EU concluded a major trade pact with the South American Mercosur bloc, following similar deals last year with Indonesia, Mexico and Switzerland. Over the same period, India finalised trade agreements with Britain, New Zealand and Oman.

The flurry of trade deals highlights efforts by major economies to diversify partnerships amid strained relations with the United States, as President Donald Trump’s attempt to take control of Greenland and his tariff threats against European countries unsettle long-standing alliances.

Trump has imposed a 50 percent tariff on Indian goods, and an India–U.S. trade agreement collapsed last year after talks broke down between the two governments.

According to an Indian government official familiar with the process, the formal signing of the India–EU agreement will take place after legal vetting, which is expected to take five to six months. The deal is expected to be implemented within a year.