New Delhi, Jan 27 (NationPress) Prime Minister Narendra Modi is preparing to preside over the 16th European Union-India Summit in the capital city on Tuesday. He will be joined by Ursula von der Leyen, the President of the European Commission, and Antonio Costa, the visiting President of the European Council, to publicly announce the ‘mother of all trade deals’.

As per Commerce Secretary Rajesh Agrawal, the negotiations for the highly anticipated Free Trade Agreement (FTA) between India and the EU have been successfully concluded, and the official announcement will be made during the summit.

This summit serves as a platform to enhance the EU-India strategic partnership and to reinforce collaboration in critical areas including trade, security and defense, clean energy transition, and people-to-people ties.

Officials indicate that the signing of the agreement is expected to occur approximately six months after the legal review, with implementation anticipated sometime next year.

This summit is set against a backdrop of growing positivity in EU-India relations observed in recent years.

Agrawal described the upcoming agreement as both balanced and forward-looking, emphasizing that it will enhance economic integration between India and the EU, while significantly increasing trade and investment.

The India-EU FTA is regarded as a crucial advancement in broadening India’s global trade influence. This agreement may mitigate the adverse effects of high US tariffs, thereby unlocking greater opportunities in the European market, particularly for Indian exports like textiles and jewelry.

One of the most notable implications of this deal is the potential opening of India’s automobile sector to European manufacturers. Import duties on European vehicles are projected to be significantly reduced from the current 110% to approximately 40%, allowing brands like Volkswagen, Mercedes-Benz, and BMW to become more affordable in India.

Currently, European firms possess only about 4% of India’s annual car market, which totals 4.4 million units. The EU already holds a vital role in India’s trade ecosystem, representing around 17% of India’s total exports, while exports from India account for about 9% of the EU’s external shipments.

For the financial year 2024–25, India's bilateral trade in goods with the EU reached $136.53 billion, comprising $75.85 billion in exports and $60.68 billion in imports, making the EU India’s largest trading partner in goods. Trade in services between both parties escalated to $83.10 billion in 2024.