India and the European Union are moving closer to finalising a Free Trade Agreement (FTA) that could significantly enhance trade, investment, and industrial collaboration between the two major economies. 

Speaking at the second Annual General Meeting of the Federation of European Business in India (FEBI) in New Delhi, Herve Delphin, the EU Ambassador to India, underscored that an FTA remains the key to unlocking the “huge untapped potential” in EU‑India economic relations.

According to a FEBI survey, over 6,000 European companies currently operate in India, together generating more than three million jobs. These firms are actively contributing to India’s Make in India initiative through investments in local manufacturing, innovation, and exports. Delphin highlighted that European companies are not merely investing in India but are deeply integrated into its economic ecosystem, playing a major role in production and technology transfer.

The European Union continues to be India’s largest trading partner, with trade in goods reaching EUR 120 billion—surpassing both the United States and China—and total bilateral trade, including services, at approximately EUR 180 billion. Despite these robust figures, the Ambassador pointed out that both sides still have immense potential to grow. The EU and India rank as the world’s second- and fourth‑largest economies respectively, positioning them strongly for greater synergy.

The next (14th) round of FTA negotiations is scheduled for October 6 in Brussels, where discussions are expected to focus on trade in goods, services, and sustainable value chains. Delphin noted that if an agreement is reached, it could give a major boost to investment flows, with as many as 80 per cent of EU firms expressing readiness to increase their investments and employment in India under an FTA framework.

Both European Commission President Ursula von der Leyen and Prime Minister Narendra Modi have set an ambitious target to conclude the FTA negotiations by the end of 2025. The EU has reiterated that it remains prepared to finalise a “meaningful package” that ensures balance and mutual benefit. Parallel to the FTA talks, the two sides are negotiating an Investment Protection Agreement aimed at safeguarding investors while preserving governments’ rights to regulate in the public interest.

The EU recently unveiled a comprehensive EU‑India Strategic Agenda, framing cooperation beyond trade to encompass prosperity, sustainability, technology, defence, and people mobility. Key proposals include the creation of innovation hubs, “Blue Valleys” for maritime and supply‑chain development, and a revamped TTC 2.0 mechanism focused on critical technologies. Another initiative—the EU‑India Gateway Office—will facilitate ICT professional mobility and business collaboration.

Ambassador Delphin noted that India’s rapid economic rise forms a central element of Europe’s global economic vision. The FEBI community, which represents the collective presence of European businesses in India, was described as an integral part of India’s growth story. As India celebrated Navratri during the week of the meeting, Delphin called it an auspicious sign for the strengthening of EU‑India cooperation and the conclusion of a comprehensive, future‑oriented partnership agreement.

Based On ANI Report