Brussels and New Delhi are approaching the conclusion of a long-term free trade agreement (ALE), which, if finalized, would to date represent one of the most important trade agreements in the European Union.
Following a renewed diplomatic push, the EU trade commissioner, Maroš Šefčovič and the Indian Minister of Commerce, Piyush Goyal, supervised intensified negotiations in recent months, which has aroused expectations that an agreement could be concluded by the end of 2025.
Renewed strategic focus
Negotiations for an EU-Indian ALE were originally launched in 2007, but were suspended in 2013 due to profound differences in prices, regulatory alignment, intellectual property and market access. However, the changing geopolitical environment – including concerns about the economic rise of China, the Russian war against Ukraine and the disturbances of global supply chains – has reoriented the strategic prospects of Brussels to forge closer links with partners sharing the same ideas in Indo -Pacific.
In this context, the European Commission reset the official negotiations in 2022. In mid-2010, at least eleven negotiations had taken place. According to a statement made by Šefčovič in May, the EU remains determined to conclude the agreement “at the end of 2025 or before the end of 2025”, noting that the two parties share “a strong alignment on economic priorities and basic sustainability”.
India is the ninth EU trading partner, while the EU is the largest in India. The bilateral trade in goods reached 124 billion euros in 2023 and the trade in services amounted to nearly 60 billion euros. Brussels considers the agreement as essential to strengthen the presence of the EU in the region and to ensure diversified economic partnerships based on rules.
Scope and structure of the agreement
The potential Ale is envisaged as a complete agreement, encompassing goods, services, investment protection, digital trade, government purchases, geographic indications and regulatory cooperation. It will also include an autonomous chapter on trade and sustainable development, aligned with the broader priorities of the Green Agreement of the EU.
An investment protection agreement and a dedicated agreement on geographic indications should be concluded in parallel or immediately after the Core Ale. According to EU sources, about eight of the twenty chapters in the agreement have already been settled. These include intellectual property rights, rules of origin, customs facilitation and certain health and phytosanitary standards.
However, a number of complex questions remain under discussion. These include access to the EU market for Indian services, mutual recognition of professional qualifications, the transparency of purchases and access to India to the EU single market for sensitive sectors such as cars, dairy products and alcoholic drinks. The carbon border adjustment mechanism (CBAM) has also become a concern for Indian negotiators, who argue that it imposes a commercial burden on developing economies.
From Brussels’s point of view, the realization of regulatory convergence, significant commitments on sustainability and procedures for paying transparent disputes are not negotiable. EU officials argue that the lessons of recent commercial pacts with Australia, Chile and Vietnam are applied to ensure a balanced and enforceable framework.
Diplomatic and timetable engagement
The last two months have experienced a marked increase in high-level EU-India contacts. Commissioner Šefčovič and Minister Goyal met three times in just over a month. The eleventh cycle of negotiations ended in May with what the two parties described as “substantial progress”, and a twelfth round is temporarily scheduled for early July.
Mr. Goyal declared On June 10, the games were “really very close” to a final agreement. He described negotiations as having “mutual respect for the sensitivities of the other”, adding that India adopts an approach similar to that of the conclusion of the recent bilateral pacts with the countries of the United Kingdom and the EFTA.
In February 2025, EU officials note The fact that the accelerated pace and the severity of the negotiations reported a real impulse, while warning that some of the most complex problems – such as standards of market access and sustainability – are not resolved at the time. Since then, the two parties have continued to get involved intensively and the negotiators have reported progress on several of these points. Nevertheless, the EU maintains that additional progress will force India to demonstrate greater opening on market access and increased alignment with EU regulatory frameworks.
Strategic and economic implications
An EU-India Ale successfully concluded in the EU offers better access to one of the fastest growth savings in the world and a large general public market of more than 1.4 billion people. It would also support Brussels’ objective to reduce dependence on unique suppliers and to establish more resilient commercial corridors.
In addition, the agreement would improve the presence of the EU in Indo-Pacific and strengthen its economic weight in the world of world. It would be a counterweight at the initiative of the belt and the road to China and would complete the global strategy of the EU gateway.
In commercial terms, the European Commission considers that the agreement could generate Additional real gains from 4 to 5 billion euros for the EUAnd potentially higher long -term figures if the obstacles to services are treated effectively.
Intensating diplomatic efforts and technical teams working on closing the key chapters, Brussels remains carefully optimistic that a complete and mutually beneficial agreement will be finalized in the coming months.
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