European Council President Antonio Costa has emphasised the pivotal role of the EU-India Free Trade Agreement (FTA) as a crucial geopolitical stabiliser.

Speaking during a state visit to India alongside European Commission President Ursula von der Leyen, Costa co-chaired the 16th India-EU Summit in New Delhi.

He highlighted how the agreement underscores the commitment of both sides to uphold a rules-based international trade order amid a fragmented, multipolar world.

Costa described the EU and India as anchors of stability, acting in unison to foster partnerships rather than impose tariffs. The FTA, announced as a major summit outcome, culminates years of negotiations relaunched in 2022. This deal promises open markets, predictability, and inclusive growth, positioning the two powers as trusted economic allies.

Bilateral trade between India and the EU has surged steadily, with goods and services exchange reaching impressive heights. In 2024-25, trade in goods hit ₹11.5 lakh crore (USD 136.54 billion), including Indian exports of ₹6.4 lakh crore (USD 75.85 billion) and imports of ₹5.1 lakh crore (USD 60.68 billion). Services trade added another ₹7.2 lakh crore (USD 83.10 billion), reflecting deep economic interdependence.

As the fourth- and second-largest economies respectively, India and the EU together account for 25 per cent of global GDP and one-third of world trade. Their diverse yet complementary economies—India's manufacturing prowess paired with Europe's technological edge—stand to unlock unprecedented opportunities. Integration via the FTA could boost investment flows, job creation, and supply chain resilience.

Beyond trade, the summit yielded a new Security and Defence Partnership. Costa noted this initiative will address the full spectrum of security threats, safeguarding shared interests across Europe, the Indo-Pacific, and beyond. It signals a strategic pivot, enhancing cooperation on maritime security, counter-terrorism, and regional stability amid rising tensions.

The third key outcome is a Joint Comprehensive Strategic Agenda towards 2030. This roadmap aligns priorities in energy security, digital connectivity, and people-to-people mobility. It builds on existing frameworks like the India-EU Strategic Partnership, aiming for sustainable development and mutual prosperity.

Costa's remarks come at a time of global flux, with supply chain disruptions, geopolitical rivalries, and protectionist tendencies challenging open trade. The FTA counters these by prioritising mutual benefits over zero-sum games. For India, it advances the 'Make in India' initiative, attracting European investment in sectors like renewables, semiconductors, and defence manufacturing.

Europe, facing energy transitions and de-risking from over-reliance on certain partners, views India as a vital counterbalance. The agreement could facilitate technology transfers, joint R&D, and eased visa regimes for skilled workers. Services liberalisation may particularly benefit India's IT and pharma sectors, already strong EU exporters.

Negotiations were arduous, navigating issues like market access for automobiles, dairy, and intellectual property. Yet political will prevailed, with leaders like Costa and von der Leyen bridging gaps. The deal's modernity incorporates digital trade rules, sustainability clauses, and labour standards, setting a benchmark for future pacts.

Geopolitically, the FTA fortifies the EU's Indo-Pacific strategy, complementing partnerships like AUKUS and the Quad. For India, it diversifies trade away from traditional partners, enhancing strategic autonomy. Amid China's assertiveness, this alignment promotes a multipolar balance without overt alliances.

The defence partnership extends beyond rhetoric, potentially encompassing joint exercises, intelligence sharing, and co-production of equipment. It aligns with India's indigenous defence push under DRDO and HAL, while addressing EU needs for diversified supply chains in critical technologies.

Looking to 2030, the strategic agenda eyes green energy corridors, 5G/6G interoperability, and high-speed rail links. Mobility enhancements could ease student and professional exchanges, with over 20,000 Indian students already in EU universities annually.

Economic projections are optimistic: analysts forecast the FTA could add USD 100 billion to bilateral trade within five years. India's exports in textiles, gems, and organics stand to gain, while EU firms eye India's vast consumer base.

Challenges persist, including tariff sensitivities and non-tariff barriers. Domestic stakeholders in both regions will require careful management to ensure equitable gains. Nonetheless, the summit's trinity—FTA, defence pact, and 2030 agenda—marks a watershed.

Costa's visit, timed post-India's Republic Day, symbolises deepening ties. As global uncertainties mount, this partnership exemplifies pragmatic multilateralism, blending economic ambition with security imperatives.

Based On ANI Report