EU and India Clinch ‘Mother of All Deals’ in Rebuff to Trump.
“We have concluded the mother of all deals. We have created a free trade zone of two billion people, with both sides set to benefit.” - European Commission President Ursula von der Leyen and European Council President Antonio Costa.
The deal is expected to double EU goods exports to India by 2032 by eliminating or reducing tariffs on 96.6% of EU goods exports to India. Meanwhile, the EU will eliminate or reduce tariffs on 99.5% of goods imported from India over seven years.
The conclusion of negotiations after years (two decades) of halting talks reflects the rapidly shifting global alignment under US President Donald Trump. The EU, despite long clashing with Indian officials over trade matters, is now focused on shedding its economic reliance on the US and China. India is similarly trying to shake its protectionist reputation and offset a 50% Trump tariff, while at the same time balance its ties with Russia.
Amitendu Palit, the research lead on trade and economics at the Institute of South Asian Studies - “Diversification is absolutely essential. That is the name of the game.”
The agreement mostly offers a political signal, part of an EU effort to expand its alliances as Trump rattles the transatlantic bond. The EU has struck similar deals recently with countries like the UK and Canada.
Modi is similarly trying to find new markets for a country Trump once dubbed the “tariff king.” This agreement marked Modi’s fourth trade deal since last May, following pacts with the UK, Oman and New Zealand.
