Kashish Parpiani
This month, the European Union unveiled its new strategy to “reinforce prosperity and security” with India.
The Joint Communication to the European Parliament and the Council proposes structuring the India-EU cooperation agenda around five focus areas: prosperity and sustainability; technology and innovation; security and defense; connectivity and global issues; and enablers across pillars.
Moreover, it dispels any notion that the EU’s “Competiveness Compass” and India’s “Atmanirbhar Bharat” focus are at odds. Instead, the EU Joint Communication on a New Strategic EU-India Agenda commits Europe’s regulatory expertise, single market access, and joint innovation to support India’s inclusive and sustainable growth.
The EU Joint Communication affirming Europe’s intent for deeper engagement with India comes amid ongoing India-EU trade negotiations for a comprehensive Free Trade Agreement (FTA). India’s Minister of Commerce Piyush Goyal recently said that it is important “not to let the search for a perfect deal become the enemy of progress,” adding that the direction of negotiations is “extremely positive.”
This sentiment was echoed by EU Commissioner for Trade and Economic Security (Interinstitutional Relations and Transparency) Maros Sefcovic, who said that India-EU trade negotiations have reached an unprecedented level of “seriousness, mutual trust, and shared ambition.” He even said that efforts are being “maximized to finalize the negotiations by the end of the year.”
This shared emphasis on conducting an FTA stems from the vast untapped potential of India-EU ties. In 2024, India-EU trade in goods reached 120 billion euros, making an increase of about 90 percent over the past decade. This was coupled with services trade rising to 60 billion euros. Around 6,000 European companies operate in India, and EU FDI in India reached 140 billion euros in 2023 – almost doubling over five years. Despite this encouraging trajectory, India accounts for just 2.5 percent of the EU’s total trade.
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