EU–India trade deal: the “Mother of all agreements” reaches a historic breakthrough

After nearly two decades of negotiations, Brussels and New Delhi seal a landmark pact reshaping global trade, supply chains, and geopolitics.

The new trade agreement between the European Union and India - often described by negotiators as the “mother of all agreements” - has reached a historic turning point in recent days (January 2026). Although talks first began back in 2007, the decisive acceleration came in response to Europe’s need to reduce its dependence on China and to recent uncertainties in trade relations with the United States. Here are its main provisions:

1. Tariff Reduction on Industrial and Agricultural Goods

The agreement aims to liberalize more than 90% of bilateral trade.

For Europe: European producers gain unprecedented access to the Indian market for cars, machinery, chemicals, and pharmaceutical products. A key breakthrough concerns alcoholic beverages: India has agreed to drastically reduce the massive 150% tariff on European wines and spirits.

For India: Tariffs on textiles, clothing, and agricultural products exported to the EU will be eliminated. However, safeguard clauses are предусмотрed to protect European farmers from sudden import surges in sensitive sectors such as rice.

2. Access to Critical Minerals and Green Energy

This is perhaps the most strategic component for Europe’s industrial autonomy. The agreement facilitates the extraction and export from India of critical raw materials needed for the production of batteries and solar panels. In return, the EU commits to transferring decarbonization technologies and to making substantial investments in India’s green hydrogen sector.

3. Services and Professional Mobility

Unlike many other trade deals, this agreement places a strong emphasis on the services sector.

Digital trade: Common rules are established on data flows and e-commerce.

Talent mobility: India has secured streamlined visa procedures for its IT professionals and engineers working temporarily in Europe, while European companies will find it easier to participate in Indian public procurement tenders.

4. Investment Protection and Geographical Indications

Legal safeguards: A new system is created to protect mutual investments against discrimination or unjust expropriation.

PDOs and PGIs: India will recognize and protect hundreds of European food products and wines - such as Parmigiano Reggiano and Prosecco - against local counterfeiting.

The agreement is widely seen as a crucial geopolitical counterweight. It brings together two markets that collectively account for around 2 billion people and represent nearly a quarter of global GDP.

UCapital Media