“Mother of all deals”: India, EU seal landmark free trade pact as PM Modi calls it a pillar of global stability

India and the European Union on January 27, marked a major milestone in their strategic partnership with the formal conclusion of negotiations for the India-EU Free Trade Agreement (FTA), a pact Prime Minister Narendra Modi described as the largest trade agreement in India’s history.

The agreement was witnessed during the 16th India-EU Summit held at Hyderabad House, co-hosted by Prime Minister Modi, European Commission President Ursula von der Leyen, and European Council President António Luís Santos da Costa. The leaders jointly observed the signing and exchange of a political declaration confirming the completion of negotiations for the long-awaited trade deal.

Alongside the FTA, India and the EU also exchanged key cooperation documents, including the establishment of a Green Hydrogen Task Force, a Memorandum of Understanding between the Reserve Bank of India and the European Securities and Markets Authority, and an administrative arrangement on advanced electronic seals and digital signatures. An agreement on cooperation in disaster risk management was also signed.

Addressing the media, Prime Minister Modi underscored the scale and strategic importance of the agreement. “On 27th January, India signed this FTA with 27 European nations…This will boost investment, form new innovation partnerships and strengthen supply chains at the global level…This is not just a trade agreement, it is a blueprint for shared prosperity,” he said.

Highlighting the broader geopolitical context, Modi said the agreement comes at a time of global uncertainty and instability. He announced the launch of a comprehensive five-year strategic agenda aimed at deepening economic cooperation, accelerating innovation, enhancing defence collaboration, and strengthening people-to-people ties.

“The coming together of India and the EU is a partnership for global good. We will advance trilateral projects from the Indo-Pacific to the Caribbean. Together, we will establish the IMEC corridor as an important link for global trade and sustainable development,” he stated, adding that closer India-EU cooperation would help stabilise the international system.

The Prime Minister also noted discussions with EU leaders on pressing global challenges, including the war in Ukraine, and reiterated the need for reforms in global institutions. “This is the moment when we are starting a new chapter in our relationship between India and the EU,” he said.

European Council President António Luís Santos da Costa termed the agreement a “historic moment,” thanking India for hosting EU leaders during the Republic Day celebrations. “We are opening a new chapter in our relations on trade, on security, and on people-to-people ties,” he said, describing the pact as one of the most ambitious trade agreements ever concluded, creating a combined market of nearly two billion people.

European Commission President Ursula von der Leyen echoed the sentiment, calling the agreement “the mother of all deals.” “We have created a free trade zone of two billion people, with both sides set to benefit. This is only the beginning. We will grow our strategic relationship to be even stronger,” she said.

The trade pact is expected to significantly expand market access, boost manufacturing, and deepen services sector collaboration. “The Free Trade Agreement will boost the confidence of every investor and businessman to invest in India…,” Modi noted, adding that the agreement covers nearly a quarter of global GDP and one-third of global trade.

In parallel, India and the EU also signed a Security and Defence Partnership during the summit. EU Vice President Kaja Kallas described the agreement as “a milestone,” stating that it opens new avenues for defence cooperation both bilaterally and in multilateral forums.

With trade, technology, security, and sustainability at its core, the India-EU FTA marks a defining moment in the evolving global economic and strategic landscape.