The European Union (EU) is signaling a renewed commitment to its relationship with India, with a strong emphasis on finalizing a comprehensive Free Trade Agreement (FTA) by the end of 2025. This comes amidst a backdrop of shifting geopolitical realities and a mutual desire to strengthen economic growth and security.

A New Strategic Agenda

The European Commission and the High Representative have adopted a Joint Communication outlining a "New Strategic EU-India Agenda," marking a significant milestone in EU-India relations. This initiative aims to deepen, broaden, and better coordinate bilateral cooperation, enhance prosperity and security for both partners, and help tackle major global challenges. The agenda identifies five areas of shared interest and complementary strengths, building on existing ties while addressing areas that present potential for increased engagement.

Ursula von der Leyen, President of the European Commission, stated that it is time to focus on reliable partners and strengthen partnerships rooted in shared interests and common values. She highlighted the EU's commitment to advancing trade, investment, and talent mobility; strengthening economic security; advancing the clean transition and driving innovation; and deepening industrial cooperation in defense.

FTA Negotiations Gain Momentum

Negotiations for the FTA are gaining momentum, with the 14th round of talks scheduled to take place in Brussels in early October 2025. Both sides are working towards a balanced and mutually beneficial agreement. The EU is seeking duty concessions in the automobile sector, similar to those India granted to the UK under their trade pact signed earlier in 2025. India, on the other hand, is seeking preferential access for its labor-intensive exports, such as textiles, apparel, and leather, as well as products like machinery, chemicals, and pharmaceuticals.

The EU views the FTA as a means to unlock investment, reduce barriers, expand market access, and improve supply chains. The EU Trade Commissioner stated that the EU-India relationship is not just about trade, but also about high-value-added investment that will create jobs. India's Commerce Minister Piyush Goyal has emphasized the need to finalize the trade deal without getting bogged down in the pursuit of a "perfect deal".

Beyond Trade: Deepening Strategic Cooperation

The new strategic agenda extends beyond trade to encompass various areas of cooperation. The EU and India are exploring ways to deepen their security cooperation, with a focus on maritime security and ensuring free commerce across the Indo-Pacific. They are also working on a security of information agreement to advance cooperation on sensitive domains. There are discussions about a potential security and defense partnership.

The EU-India Clean Energy and Climate Partnership has a deeper agenda for 2025-2028, focusing on green hydrogen, smart grids, offshore wind, energy efficiency, and regional energy connectivity. Technology transfers and climate financing are being prioritized to support Indian companies in their green transition.

Strategic Importance of the Partnership

The renewed focus on the EU-India relationship reflects the growing recognition of India's strategic importance in a changing world. India, as the world's largest democracy and fastest-growing major economy, is a vital partner for the EU. India's strategic geographical position in the Indo-Pacific makes it a key partner for maintaining regional security and freedom of navigation. Closer cooperation with India is seen as crucial for strengthening economic growth and security and diversifying supply chains in response to global uncertainties.