Donald Trump's tariff policy is starting to backfire. Following Canada's unique automotive trade agreement with China, the President of the European Commission, Ursula von der Leyen, has announced a significant mega-deal with India. Dubbed the 'Mother of All Deals', this agreement is poised to transform international trade dynamics.
The President of the European Council, Antonio Luis Santos da Costa, and the President of the European Commission, Ursula von der Leyen, are scheduled to visit India between January 25-27. This visit coincides with the 77th Republic Day celebrations, where they will be the chief guests. Additionally, on January 27, both leaders will co-chair the 16th India-EU Summit.
How Significant Are India and the EU Together?
This landmark agreement between the European Union and India is considered one of the largest global deals. With 27 member countries, including France, Germany, Spain, Sweden, and Poland, the EU's population is approximately 450 million. Combined, India and the EU represent a population of 1.913 billion, accounting for 23 percent of the world's population.
According to World Bank data, the combined nominal GDP of India and the EU in 2024 was $23.41 trillion, representing 21 percent of the global GDP.
In terms of exports, India and the European Union jointly account for 33 percent of the world's total exports and 32 percent of total imports.
Source: aajtak
India-EU Trade
The EU is India's second-largest trading partner. In 2024, trade in goods between India and the EU reached 120 billion euros, accounting for 11.5 percent of India's total trade.
India's Major Exports to the EU
Machinery and equipmentChemicalsBase metalsMineral productsTextiles
Imports from the EU to India
Machinery and equipmentTransport equipmentChemicals
Notably,
In 2024, India exported 71.3 billion euros to the EU and imported 48.8 billion euros from the EU.
Source: aajtak
Not Just Trade, But Investment Matters Too
The relationship between India and the EU extends beyond trade in goods. According to the
, there are approximately 6,000 European companies operating in India. The EU's Foreign Direct Investment (FDI) in India has also seen substantial growth.
In 2019, the EU's FDI stock was 82.3 billion euros, which increased to 140.1 billion euros in 2023, making the EU one of India's largest foreign investors. Conversely, India's FDI stock in the EU is valued at 10.2 billion euros.
