New Delhi: India and the India and European Union sign free trade agreement as United States raises concerns Union have signed a long awaited free trade agreement, marking a major step in strengthening economic ties between the two sides. The deal comes after nearly two decades of negotiations and is being described by leaders as one of the most important trade agreements in recent years.
The agreement covers a combined market of nearly two billion people and aims to increase trade in goods and services between India and the 27 nation European bloc. Under the deal, both sides will reduce or remove import duties on a wide range of products.
European exports such as cars, machinery, chemicals, wine and olive oil will face lower tariffs in India. Indian products such as textiles, leather goods, jewellery and engineering items are expected to get better access to European markets.
Some sensitive sectors, including agriculture and dairy, have been kept outside the agreement to protect local farmers and producers. Officials said the deal will now go through legal checks and approval processes in both India and the European Union before it comes into force, which could take about a year.
Leaders in New Delhi and Brussels said the agreement will help boost trade, create jobs and strengthen supply chains at a time when the global economy is facing uncertainty. They also said the deal shows their commitment to open and rules based trade.
The United States has reacted critically to the agreement. Senior US officials said the timing of the deal is troubling, as Washington has ongoing trade tensions with India. The United States has imposed high tariffs on some Indian goods in recent months, mainly over India’s continued purchase of Russian oil during the Ukraine war.
US officials argued that closer trade ties between India and Europe could weaken Western pressure on Russia and affect efforts linked to the Ukraine conflict. They also expressed concern that American businesses could lose opportunities in both the Indian and European markets.
So far, India has not issued a formal response to the US criticism. Indian officials have said in the past that the country has the right to protect its energy security and expand trade partnerships in its national interest.
Experts say the India EU trade deal reflects a wider shift in global trade patterns, with countries looking to diversify partners and reduce dependence on any single market. The agreement is expected to significantly raise trade volumes between India and Europe over the next decade and reshape economic relations across Asia and Europe.