India and the European Union are on the verge of sealing one of the most ambitious trade agreements in recent global history, European Commission President Ursula von der Leyen said on Tuesday while addressing the World Economic Forum in Davos. The long-pending India-EU Free Trade Agreement has been widely described as the “mother of all deals,” underlining its scale, economic impact, and strategic importance.
Von der Leyen’s remarks come just days ahead of her official visit to India, where she will attend the Republic Day celebrations as a chief guest and hold summit-level talks with Prime Minister Narendra Modi. She said that while some work remains, negotiations have reached a decisive stage.
“I will travel to India. There is still work to do. But we are on the cusp of a historic trade agreement,” von der Leyen told global leaders and industry heads in Davos. She noted that the proposed pact would create a combined market of nearly two billion people, accounting for almost a quarter of global GDP.
India and the European Union are expected to announce the conclusion of negotiations at the India-EU Summit scheduled for January 27, 2026. European Council President Antonio Costa and Ursula von der Leyen will be in India from January 25 to 27 to participate in Republic Day events and engage in high-level discussions with Prime Minister Modi.
Diplomatic sources indicate that the summit will go beyond trade, with both sides likely to unveil a broader strategic agenda. Along with the free trade agreement, India and the EU are expected to announce a defence cooperation framework and a comprehensive strategic vision to guide bilateral relations from 2026 to 2030.
Speaking at Davos, von der Leyen also highlighted Europe’s global outreach, saying the European Union remains committed to deeper engagement across regions. “From Latin America to the Indo-Pacific and far beyond, Europe will always choose the world. And the world is ready to choose Europe,” she said.
India and the European Union have been strategic partners since 2004, and their economic ties have expanded steadily over the years. The EU is currently India’s largest trading partner, with bilateral trade in goods touching USD 135 billion during the financial year 2023–24. The proposed free trade agreement is expected to significantly boost trade, investment, and market access across key sectors.
Experts believe the agreement could bring a qualitative shift in bilateral relations, particularly in areas such as manufacturing, clean energy, pharmaceuticals, digital services, and advanced technology. The timing of the deal is also significant, as both sides seek to safeguard supply chains and reduce vulnerability amid global trade disruptions and evolving tariff policies, especially those emerging from Washington.
Negotiations for the India-EU Free Trade Agreement were first launched in 2007 but were suspended in 2013 due to differences over tariffs, regulatory standards, and market access. After nearly a decade, talks were revived in June 2022, reflecting renewed political commitment on both sides in a changing geopolitical and economic environment.
If finalised, the agreement would rank among the world’s largest bilateral trade pacts, strengthening ties between two major democratic economies and reinforcing a rules-based global trade order. By linking nearly two billion consumers, the deal has the potential to reshape global commerce and deepen India-EU relations for decades to come.