EU-India deal ‘accelerated with gusto’ over past six months amid Trump’s tariff threats – snap analysis
Hannah Ellis-Petersen
South Asia correspondent
in New Delhi
India, the world’s largest country with a population of 1.4 billion, is also one of the world’s fastest-growing economies and is on track to become its fourth-largest economy this year, according to the International Monetary Fund.
The deal is one of the most comprehensive that India has ever signed and Narendra Modi emphasised that it represented about a third of global trade, calling it the “biggest free trade deal in history”.
“This agreement has brought massive opportunities for 1.4 billion Indians and millions of people in European countries,” he said. “It has become a wonderful example of synergy between two of the world’s major economies.”
Trade talks between the two countries began as far back as 2007 but were abandoned owing to disputes over access to cars, agriculture and dairy.
However, they were resumed again in 2022 and accelerated with gusto over the past six months in the face of heavy punitive tariffs by Donald Trump’s administration in the US and joint concerns over China’s monopoly over global manufacturing and the country’s restrictions on key exports.
According to officials, the formal signing of the deal will take place later this year and it could come into play by early next year.
Key events
Iran summons Italian ambassador over EU terrorist register efforts
Iranian state media is reporting that Iran’s foreign ministry has summoned Italy’s ambassador over Rome’s efforts to place the Revolutionary Guards on the European Union’s terrorist register, according to Reuters.
Iran’s foreign ministry called upon the Italian foreign minister to “correct his ill-considered approaches toward Iran” and warned of the “destructive consequences” of any labelling against the Revolutionary Guards.
Finland hails ‘historic’ EU agreement with India
Finnish president Alexander Stubb is the latest European leader to welcome the new EU-India trade deal confirmed this morning.
He said it was a “historic” agreement, and will “further intensify our economic and political ties with India.”
“In these times, it is important for both the EU and Finland to strengthen partnerships all over the globe,” he added.
His comments come as Finland’s prime minister Petteri Orpo is in Beijing for separate talks with China, with Reuters noting that US president Donald Trump’s volatile foreign policy decisions and confrontational approach toward allies push European countries to diversify their foreign relations.
‘Europeans can and must take charge of their security,’ French foreign minister says in pushback to Rutte’s comments
France has pushed back on Nato secretary general Mark Rutte’s suggestion that Europe is not in a position to defend itself without the US.
Speaking in the European parliament on Monday, Rutte said told EU lawmakers that if they thought the EU or Europe as whole could defend itself without the US, they should “keep on dreaming” (Europe Live, Monday).
In a rare public rebuke, French foreign minister Jean-Noël Barrot disagreed with him on X, stressing “Europeans can and must take charge of their own security.”
“Even the United States agrees. It is the European pillar of Nato,” he said.
The European Commission also slightly distanced itself from Rutte’s comments this afternoon, pointing to the EU’s commitment to “become increasingly resilient … and independent on various fronts,” including energy, critical raw materials, and security.
“We’re really pulling together a number of measures with one aim, which is … that we can all really, on various fronts, ensure such gradual independence,” commission chief spokesperson Paula Pinho said.
European Commission ready to defend its Russian energy imports phase out policy despite Slovak, Hungarian legal threat
The European Commission has just responded to the Slovak and Hungarian threat of legal action against its policy to phase out Russian gas imports (12:14).
Energy spokesperson Anna-Kaisa Itkonen told journalists at the daily midday briefing that the bloc’s objective “is never to end up in a situation where any of our member states legally challenge our legislation,” but to work with the member states instead.
But the countries can challenge the policy if they want to, and “we will be there to defend our position.”
“We really stand by the legislation, and there is solid legal work behind [it], so we are also very confident that we are in a position to defend the legislation that has been widely endorsed by the member states,” chief spokesperson Paula Pinho added.
Zelenskyy eyes 2027 for Ukraine’s accession to European Union
Ukrainian president Volodymyr Zelenskyy has said he wanted to target 2027 for Ukraine’s accession to the European Union.
In a brief update after his phone call with Austrian chancellor Christian Stocker, Zelenskyy said that “Ukraine’s accession to the European Union is one of the key security guarantees not only for us, but also for all of Europe.”
“After all, Europe’s collective strength is possible, in particular, thanks to Ukraine’s security, technological, and economic contributions. That is why we are speaking about a concrete date – 2027 – and we count on partners’ support for our position,” he said.
Zelenskyy also said he spoke with Stocker about Ukraine’s struggle amid continuing Russian attacks on critical infrastructure.
In an earlier post, Zelenskyy said that almost 1,000 buildings in Kyiv were still left without heating this morning.
European carmakers back EU-India deal as ‘strong statement of intent’
The European carmakers’ association has welcomed the EU’s trade deal with India, saying it sent “a strong statement of intent by both parties to furthering more open and mutually beneficial trade relations.”
“It will greatly help European automobile exports enter a market of 4 million passenger cars that, until now, has been protected by prohibitively high import tariffs of up to 110%,” the European Automobile Manufacturers Association, or ACEA, added.
“ACEA members support this FTA and will ask EU member states and the European parliament to give their timely approval to allow for its implementation as soon as possible,” it said.
Slovakia to join Hungary in challenging EU’s decision to ban Russian gas imports
Slovakia will challenge the European Union’s decision to ban Russian gas imports, Slovak prime minister Robert Fico said.
Slovakia will join Hungary in challenging the policy at the European court of justice, after the two countries were outvoted on Monday, as they continued to oppose the policy given their heavy reliance on Russian energy imports (Europe Live, Monday).
Speaking at a press conference in Bratislava, Fico argued that the decision violated the EU’s subsidiarity and solidarity principles, alleging the EU overstepped its competences.
The two countries will pursue separate claims, as there is no format in which these can be joined into a single legal action, Fico said, but he added that they would “coordinate” their arguments.
Potential ICE agents presence during Milan-Cortina Olympic Games sparks controversy in Italy
Meanwhile, there is a growing controversy around the potential presence of US Immigration and Customs Enforcement officers during the upcoming winter Olympic Games in Milan-Cortina in Italy.
Agents from the controversial agency are expected to form part of the security detail accompanying US officials, as US vice-president JD Vance and state secretary Marco Rubio are scheduled to attend the games, AP and AFP reported via US diplomatic sources.
US officials were quoted as insisting that they would not run any immigration enforcement operations and only assist in broader security operations.
But their presence has already sparked controversy, with Milan mayor Giuseppe Sala telling RTL radio that “it’s clear” the agents would not be welcome in the city.
“I believe they shouldn’t come to Italy because they don’t guarantee they’re aligned with our democratic security management methods. We can take care of their security ourselves. We don’t need ICE,” he said.
La Repubblica daily newspaper claimed that the Italian government had briefly looked into blocking the participation of ICE agents in the delegation, but that would have required a departure from how US officials are usually protected during similar high-profile visits abroad.
However, the paper noted that their involvement risked sparking public demonstrations against the service amid continuing outrage against the Minneapolis shootings.
AP noted that the confirmation of ICE’s role comes after RAI state TV aired video of ICE agents threatening to break the glass on the vehicle of a RAI crew reporting in Minneapolis.
Danish, Greenlandic prime ministers to visit Berlin, Paris to shore up support against Trump’s threats
In other news, the prime ministers of Denmark and Greenland said they would visit Berlin and Paris to shore up support over US president Donald Trump’s recent push to take over the Arctic island that has been Danish territory for centuries, Reuters reported.
Denmark’s Mette Frederiksen and Greenland’s Jens-Frederik Nielsen will meet German chancellor Friedrich Merz on Tuesday and French president Emmanuel Macron on Wednesday, official schedules showed.
Frederiksen and Nielsen would discuss “the current foreign policy situation and the need for a strengthened Europe” in their meetings, the Danish prime minister’s office said.
EU-India deal ‘accelerated with gusto’ over past six months amid Trump’s tariff threats – snap analysis
Hannah Ellis-Petersen
South Asia correspondent
in New Delhi
India, the world’s largest country with a population of 1.4 billion, is also one of the world’s fastest-growing economies and is on track to become its fourth-largest economy this year, according to the International Monetary Fund.
The deal is one of the most comprehensive that India has ever signed and Narendra Modi emphasised that it represented about a third of global trade, calling it the “biggest free trade deal in history”.
“This agreement has brought massive opportunities for 1.4 billion Indians and millions of people in European countries,” he said. “It has become a wonderful example of synergy between two of the world’s major economies.”
Trade talks between the two countries began as far back as 2007 but were abandoned owing to disputes over access to cars, agriculture and dairy.
However, they were resumed again in 2022 and accelerated with gusto over the past six months in the face of heavy punitive tariffs by Donald Trump’s administration in the US and joint concerns over China’s monopoly over global manufacturing and the country’s restrictions on key exports.
According to officials, the formal signing of the deal will take place later this year and it could come into play by early next year.
It’s quite notable how relations with India picked up over the last year as Europe looks to find new markets as a result of Trump’s erratic trade policy.
German chancellor Friedrich Merz was in India earlier this month, talking about the relationship being a “high priority” for his government.
France’s Emmanuel Macron is expected to follow next month, attending the AI Impact Summit, and he pointedly shared a selfie with India’s prime minister Narendra Modi last night, marking India’s Republic Day celebrations.
Italy’s Giorgia Meloni spoke with Modi late last year, offering her backing for the EU-India trade deal, too, and her foreign minister, Antonio Tajani, visited the country in December with a 50-strong delegation with representatives of Italian businesses.
Chair of the European Parliament’s international trade committee, Bernd Lange, said “the conclusion of negotiations with India offers a glimmer of hope amid a chaotic geopolitical situation.”
“The EU is not alone in its insistence on a rules-based order. This is only the beginning of close cooperation with India. We can build on this foundation in the future,” he said.
Germany has rushed to welcome the deal, saying it could support growth at a time of increasingly challenging ties with other major economies, AFP reported.
“This agreement creates new opportunities for growth and good jobs – in Europe and India alike – while deepening the strategic partnership with the world’s largest democracy,” said Lars Klingbeil, Germany’s finance minister.
If you are after a detailed “fact sheet” on the deal, the EU’s document is here.
It says the agreement will save up to €4bn per year in duties on European products and pointedly says it is the biggest trade opening India has given to any trade partner (hello UK).
Here are some specific examples from the Q&A:
“For example, tariffs on cars will gradually go down from 110% to 10% with a quota of 250,000 vehicles a year. High tariffs of up to 44% on machinery, 22% on chemicals and 11% on pharmaceuticals will be mostly eliminated.”
Morning opening: ‘The mother of all trade deals’
Jakub Krupa
The European Union has concluded trade talks with India this morning, signing also a bunch of separate deals on mobility, security, and defence, among others.
The accord would open up India’s vast and highly guarded market, with New Delhi slashing tariffs on cars to 10% over five years from as high as 110%, Reuters reported. The deal will also cut tariffs on a slew of EU goods coming to India including machinery, electrical equipment, chemicals and iron and steel, the EU said.
The EU is keen to stress that the EU and India already trade over €180bn worth of goods and services per year, supporting close to 800,000 EU jobs, and the EU’s goods exports to India is expected to double by 2032.
“This is the most ambitious trade opening that India has ever granted to a trade partner,” the bloc said, creating a market of more than 2 billion people.
India’s Narendra Modi welcomed the deal saying “the two largest democratic powers of the world are adding a decisive chapter to their relations,” as he hailed “the largest ever free trade agreement in its history.” The European Commission president, Ursula von der Leyen, went further and called it “the mother of all trade deals.”
The agreements will still need to go through the usual ratification process, including by the member states and the European parliament.
But there is no hiding away from the fact that the deal – 19 years in the making – gets also signed now as the EU urgently looks for new trade partners to diversify its trade given increasingly shaky relations with the US under tariff-happy Donald Trump. Earlier this month, the EU signed a deal with the South American bloc Mercosur, after 25 years of negotiations.
The European Council’s president António Costa – who holds an overseas citizenship of India thanks to his Goan roots – said that the deal “sends a clear message to the world at a time when the global order is being fundamentally reshaped.”
I will bring you the main reactions to the deal.
Separately, I will be keeping an eye on the latest on Ukraine and Greenland
It’s Tuesday, 26 January 2026, it’s Jakub Krupa here, and this is Europe Live.
Good morning.
