Commerce and Industry Minister Piyush Goyal has declared that the upcoming India-EU Free Trade Agreement will be the "mother of all deals" signed since 2014, expressing confidence that negotiations could conclude by January 27 when EU leadership is expected to meet Prime Minister Narendra Modi in New Delhi. The Minister emphasized that not a single EU member state opposes the trade partnership, with all 27 nations conveying support for the FTA at different times over recent months.

Strong Political Support and Timeline

Goyal highlighted the unprecedented backing for the agreement, stating there is "every possibility that we are getting a good deal by 27th January." The Minister described the potential FTA as offering a "super deal" to the EU in their sectors of interest, with India receiving similar benefits, creating a win-win prospect for both sides.

India has signed seven FTAs since 2014, including agreements with Mauritius, Australia, UAE, European Free Trade Association (EFTA), the UK, Oman, and New Zealand.

Negotiation Progress and Current Status

The Commerce Ministry confirmed that India-EU negotiations continue virtually on a day-to-day basis, with substantial progress achieved. The talks have entered their most critical phase, with both sides working intensively toward conclusion before the anticipated leaders' meeting.

The Ministry clarified that sensitive agricultural issues on both sides are already off the table, removing a potential major obstacle to agreement conclusion.

Outstanding Issues and Sector Negotiations

Government sources indicate ongoing discussions on several critical areas including the Carbon Border Adjustment Mechanism (CBAM), Geographical Indications (GI), critical minerals, and intellectual property rights. Both sides have exchanged comprehensive lists of GI-tagged products for potential inclusion, with India defining these as goods originating from specific locations with distinct characteristics.

The EU seeks unrestricted export access for critical minerals from India, including elimination of export duties, mirroring their earlier WTO challenge to Indonesia's nickel export ban. India is expected to seek carve-outs for stainless-steel exports to the EU in response to higher duties imposed by the bloc.

Bilateral Trade Significance

The EU represents India's largest trading partner, with substantial economic implications for both regions. The Minister noted that trade is reasonably balanced in both goods and services, holding huge opportunities for growth.

The Ministry of Commerce and Industry has conducted stakeholder consultations with automobile and steel sectors to address sector-specific concerns as negotiations advance toward the January deadline.

Indian and European Union negotiation teams are maintaining constant engagement to address remaining contentious issues in their proposed free trade agreement ahead of the India-EU Summit scheduled for January 27 in New Delhi. The high-level diplomatic activity comes as the top EU leadership prepares to attend India's Republic Day parade as chief guest on January 26.

Recent High-Level Engagements

Commerce and Industry Minister Piyush Goyal recently concluded a two-day meeting with EU Commissioner for Trade and Economic Security Maros Sefcovic in Brussels to review negotiation progress. The discussions focused on resolving key disputes that have emerged during the 16 rounds of negotiations held so far.

Commerce Secretary Rajesh Agrawal is scheduled to meet his EU counterpart, Director General for Trade of the European Commission Sabine Weyand, in Brussels on January 6-7 to continue these critical discussions.

Key Contentious Issues

The remaining disputes center on several critical areas that reflect the different economic priorities of both regions:

India is advocating for zero-duty access for its labor-intensive sectors, particularly textiles and leather industries. Conversely, the EU is seeking significant duty reductions in automobiles, medical devices, wine, spirits, meat, and poultry, along with establishing a robust intellectual property regime.

Trade Relationship Overview

The bilateral trade relationship between India and the EU demonstrates substantial economic significance:

This makes the EU India's largest trading partner for goods, highlighting the strategic importance of concluding the FTA negotiations successfully.

Negotiation Framework

The comprehensive trade discussions resumed in June 2022 after a nine-year suspension that began in 2013 due to disagreements over market opening levels. The current negotiations encompass three major agreements:

• Comprehensive Free Trade Agreement
• Investment Protection Agreement
• Geographical Indications Pact

The talks cover 23 policy areas including trade in goods and services, investment, trade remedies, rules of origin, customs and trade facilitation, competition, government procurement, dispute settlement, intellectual property rights, geographical indications, and sustainable development.

Both sides are demonstrating commitment to concluding the negotiations at the earliest opportunity, with officials emphasizing the importance of continuous engagement to bridge remaining differences and establish a mutually beneficial trade framework.