Right now, India is at a turning point in global trade. Problems with one country have made it speed things up with another. Even though talks with the US have dragged on with no clear end in sight, India has been quietly working on a deal with the EU. The two sides are close to finalizing one of India’s largest trade agreements ever. This isn’t just a change in plans, but a rethinking of India’s trade goals in today’s unpredictable world economy.
The progress is noticeable. The India-EU trade agreement has 24 sections, and 20 are already done. This shows things are almost wrapped up. Commerce Secretary Rajesh Agarwal says they’re talking every day, which shows how much both sides want to get this done. The timing makes it even more important. The leaders of the European Council and Commission will be the main guests at India’s Republic Day celebration, which is a big deal. If they announce the agreement then, it will show the world that India is serious about growing its economic ties.
On the other hand, the US trade talks are worrying Indian exporters. High taxes, especially on clothing, are already causing problems. Orders worth billions are supposedly going to countries like Bangladesh, Vietnam, and even China. This is more than just a trade issue, it’s a problem with the country’s ability to compete. If things stay uncertain, markets won’t wait. Businesses will go where things are clearer, and India could lose sales and long-term customers.
Given all this, the EU agreement seems like a good move. Europe is still one of the biggest and richest markets, and better access could help make up for the problems with the US. For India, which is strong in manufacturing and labor-based exports, the EU agreement could create new demand and keep exports growing. It might not totally replace the US market, but it could help balance India’s trade risks.
One interesting thing is what they’ve decided to leave out of the agreement. Agriculture, which is controversial for both sides, seems to be excluded. It is to be believed that this is a practical decision, not a compromise. India has always resisted opening its market to genetically modified crops, especially from the US. The EU is also dealing with pressure from its farmers, as seen in protests against the EU-Mercosur deal. By leaving out agriculture, India and the EU have chosen to make progress instead of trying to get everything perfect.
Still, there are obstacles. The EU’s carbon tax system, called CBAM, is a major concern for Indian exporters of steel, aluminum, and other products that use a lot of energy. While Europe sees CBAM as a way to fight climate change, India worries it could become a trade barrier in disguise. If they’re not careful, the carbon tax could cancel out some of the benefits of lower taxes. India needs to push for fair solutions, tech support, and getting their different levels of development recognized.
Market access for cars and whisky has also been a sticking point. Germany wants more access to India’s auto market, but India needs its own industry that employs millions. India is right to be careful here. Trade agreements shouldn’t hurt domestic industries, especially those that create jobs and spark innovation.
What’s clear is that pressure from outside has made India sharpen its plans. The uncertainty with the US deal has made leaders move faster, work harder, and look for new markets. This urgency might be a good thing. Instead of waiting for one country, India is expanding its options, gaining strength, and standing up for what it wants with confidence.
Lastly we can conclude that the India-EU trade deal being close to done is more than just a success in diplomacy. It shows what India intends to do. It shows that India is willing to adapt, negotiate hard, and work with countries that understand its economic situation. If they sign it, this agreement could change India’s trade strategy at a time when certainty is hard to find.
