India and the European Union officially concluded their long-awaited Free Trade Agreement on January 27, 2026, during the 16th EU-India Summit held in New Delhi. The agreement marks the end of a negotiation journey that began in 2007 and was revived in 2022.

The trade deal is expected to significantly benefit Indian exporters, as it eliminates or reduces tariffs on more than 99% of India’s export goods by value. Industries such as textiles, leather products, pharmaceuticals, and seafood are likely to see substantial growth. The pact is also projected to support employment opportunities, especially for small businesses, rural communities, and young workers across states including Tamil Nadu and Kerala.

In return, the European Union will enjoy reduced import duties on automobiles, industrial equipment, wine, and improved access to India’s services sector. Both parties have emphasized commitments to environmental protection, ethical labor standards, and sustainable economic development.

Indian Prime Minister Narendra Modi and European Commission President Ursula von der Leyen described the agreement as a powerful alliance between two of the world’s largest democratic economies, highlighting its role in enhancing economic resilience and contributing to global stability.