India and EU Discuss Key Trade Agreement Amid Global Tariff Threats

India and the EU meet to strengthen trade ties, overcome challenges, and explore free trade agreement possibilities amid global tariff threats.

External affairs minister S Jaishankar with Europe 1740682025749

New Delhi: India and the European Union (EU) are meeting to talk about a new free trade agreement (FTA). This meeting is important, especially since US President Donald Trump has threatened to place high tariffs on goods coming from the EU, which can impact trade for many countries.

EU Commission President Ursula von der Leyen arrived in New Delhi with 20 other EU leaders. This is their first big visit since they started their new jobs last year. They will be meeting with Indian Prime Minister Narendra Modi and other important ministers like S. Jaishankar (External Affairs), Piyush Goyal (Commerce), and Nirmala Sitharaman (Finance).

Von der Leyen has called India a “strategic ally,” especially during these times of global competition. She said, “In times of conflict, you need trustworthy friends. For Europe, India is one of those friends.” They plan to discuss how to strengthen their partnership.

India will bring up the issue of new laws in the EU like a carbon tax and rules against deforestation that could affect small Indian businesses. The EU wants to help its smaller businesses sell more products, and they should also help Indian businesses in return.

Important trade talks will take place during this visit, leading into a series of discussions scheduled in Brussels in mid-March. These talks were paused for six months and are now resuming. Both sides hope for friendly discussions, especially because of the potential tariffs from the US.

Hours before Von der Leyen’s arrival, Trump announced plans for big tariffs on EU goods, claiming the EU is hurting the US economy. He plans to charge 25% on cars and other products. The EU has said they will respond strongly to these tariffs.

Von der Leyen’s team aims to build better ties with India, focusing on trade and security. They will discuss high-tech areas like telecommunications and artificial intelligence at their meeting.

Both sides also want to work together more on defense matters, with talks about sharing information and joint exercises between the Indian Navy and the EU navies.

Von der Leyen started her visit by honoring Mahatma Gandhi. After their meeting, Jaishankar praised the importance of strengthening ties between India and the EU. While discussing the ongoing Russia-Ukraine war, India made it clear it believes that dialogue between Russia and Ukraine is the best way forward.

The EU is India’s biggest trading partner, with trade between the two exceeding $137 billion this year. They have been discussing a free trade agreement since 2007 but only resumed talks in 2022 after many years.

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