Jan 17 – The European Union is preparing to formalise its most expansive trade agreement with India, with senior EU leaders expected to travel to New Delhi to finalise the pact, according to multiple media reports.
European Commission President Ursula von der Leyen is reported to have briefed Members of the European Parliament in a closed-door session, confirming that the agreement would be signed within the month and would not extend to agricultural sectors.
Von der Leyen, alongside European Council President António Costa, is expected to sign the agreement with Indian Prime Minister Narendra Modi during a visit to New Delhi scheduled between January 25 and 27, 2026.
India’s relationship with the European Union has emerged as a key pillar of its global strategy under Prime Minister Narendra Modi’s long-term planning framework. This alignment has taken shape as both India and Europe confront economic uncertainty, geopolitical fragmentation, and the growing need for strategic coherence in a more competitive international environment.
India’s strong economic growth, expanding trade footprint, defence modernisation, and rising defence exports have reinforced its global standing, while Europe has increasingly sought reliable partners beyond traditional alignments.
At the core of this convergence is a shared emphasis on strategic autonomy. For India, this principle has guided its foreign policy in 2025, enabling engagement with major powers without full alignment to any single bloc. Rather than remaining passively non-aligned, New Delhi has actively expanded partnerships, transforming strategic autonomy into tangible diplomatic and economic influence.
This posture has carried particular relevance for Europe. In 2025, the European Union has faced a prolonged inflationary crisis that has placed sustained pressure on the euro and exposed structural weaknesses in European economic governance. As global economic competition intensifies, Europe has been forced to reassess whether it can function as a unified economic and monetary power capable of absorbing prolonged shocks.
Within this context, India’s model of economic resilience and institutional continuity has gained relevance for European policymakers seeking lessons beyond traditional Western frameworks.
India’s multi-aligned diplomacy was visible on several global platforms in 2025. At the 17th BRICS Summit held in Rio de Janeiro in July, leaders prioritised strengthening cooperation among emerging economies, with a focus on development financing, technology, global governance reform, and the interests of the Global South. Despite internal differences, the summit’s joint declaration reinforced BRICS’ role as a platform for emerging economies, while strengthening India’s positioning ahead of its assumption of the bloc’s presidency in 2026.
India also played an active role at the 2025 G20 Summit in Johannesburg, where discussions centred on climate action, economic resilience, and development financing amid geopolitical tensions and the absence of some global leaders. The final declaration reaffirmed commitments to multilateral cooperation and support for developing countries, reflecting priorities advanced by India and other emerging economies. The hosting of the summit in Africa for the first time further underscored the growing prominence of the Global South in global decision-making.
Domestically, political cohesion under Modi’s government has provided a foundation for strategic patience and long-term policy planning. Economic reforms aimed at maintaining stability and sustaining growth continued through 2025, reinforcing investor confidence despite global headwinds.
Within this framework, relations with Europe have gained prominence. New Delhi has increasingly viewed European states as like-minded partners capable of helping balance major global powers. At the same time, Europe’s rising defence spending and renewed geopolitical focus have signalled a growing convergence with India’s strategic interests, particularly in areas of investment, advanced technology, and security cooperation.
Economic growth has remained central to India’s global influence. In 2025, the country sustained one of the highest growth rates among major economies, with GDP expanding by approximately 6.7 per cent, exceeding 8 per cent in one quarter, driven by strong domestic demand and investment.
