European Commission President Ursula von der Leyen’s visit to India marks a pivotal moment in EU-India relations. With trade between the two reaching $126 billion in 2024 and long-pending free trade agreement (FTA) negotiations underway, the visit underscores the European Union’s urgent need for new partnerships. As the EU faces challenges from both the United States and China, strengthening ties with India has become a strategic imperative.
Why the EU Seeks Stronger Ties with India
Recent global developments have reinforced the importance of a robust EU-India partnership. US President Donald Trump’s threat of a 25% tariff on European imports and China’s expanding economic influence have left Europe at a crossroads. In this uncertain landscape, India offers the EU both economic stability and strategic alignment.
Von der Leyen’s two-day visit, accompanied by a high-level EU delegation, includes meetings with Prime Minister Narendra Modi and key Indian ministers. This visit is expected to accelerate cooperation in trade, investment, technology, and security.
A Mutually Beneficial Economic Partnership
Trade remains the backbone of the EU-India relationship. The EU is India’s largest trading partner, with bilateral trade in goods reaching nearly $126 billion in 2024—an impressive 90% increase over the past decade.
India’s rapidly growing economy, projected to become the third-largest by 2030, presents vast opportunities for European businesses. Key sectors such as automobiles, wines, and spirits view India as a crucial market amid rising global protectionism. Additionally, India’s “Make in India” initiative and its drive to become a manufacturing hub provide avenues for European investment and trade diversification.
For India, the EU represents an essential partner in reducing its dependence on China. European expertise in technology, infrastructure, and investment aligns with India’s “Developed India” (Viksit Bharat) vision and its ambitious goal of boosting total exports to $2 trillion by 2030.
However, despite these economic incentives, hurdles remain. Negotiations for an FTA have dragged on for nearly two decades due to regulatory barriers, intellectual property concerns, and bureaucratic complexities. Both sides recognize the need to overcome these challenges to unlock the full potential of their partnership.
Shared Strategic Interests in the Indo-Pacific
Beyond trade, India and the EU share common security concerns, particularly in the Indo-Pacific. China’s growing assertiveness, cyber threats, and maritime security issues have pushed the EU to deepen its engagement in the region.
India, with its expanding naval capabilities and strategic partnerships, plays a key role in maintaining regional stability. The EU-India Trade and Technology Council (TTC), established in 2022, has become a crucial platform for cooperation in areas such as artificial intelligence, cybersecurity, digital governance, and green technologies. This initiative aims to strengthen supply chain resilience, economic security, and technological collaboration—critical needs for both partners.
Another key development is the India-Middle East-Europe Economic Corridor (IMEC), which aims to enhance connectivity between India and Europe via the Gulf states, Israel, and Jordan. This project reduces reliance on traditional trade routes like the Suez Canal and diversifies supply chains, making it a significant geopolitical and economic initiative for both India and the EU.
India’s Role in Balancing Global Power Shifts
The EU’s increasing focus on India is also driven by global political shifts. The ongoing Russia-Ukraine conflict has strained EU-Russia relations, while India’s neutral stance has positioned it as a potential mediator. Despite India’s historical ties with Russia, the EU has chosen engagement over isolation, recognizing India’s rising geopolitical influence.
Rather than pressuring India to sever its economic ties with Russia, the EU is exploring ways to collaborate on shared priorities, such as securing supply chains for critical minerals and advancing defense cooperation.
Furthermore, India’s leadership in the Global South presents new opportunities for the EU. India’s expanding partnerships in Africa and Latin America—particularly in digital transformation and infrastructure projects—align with Europe’s foreign economic policies. The EU sees India as a strategic bridge to these emerging markets, facilitating greater investment and collaboration.
The Road Ahead for EU-India Relations
While the potential for deeper EU-India ties is clear, success depends on translating diplomatic rhetoric into tangible outcomes. Key priorities include finalizing the long-delayed trade agreement, strengthening regional security partnerships, and enhancing technological collaboration.
As global uncertainties grow, India’s role in the EU’s strategic calculations will only become more significant. The coming years will be crucial in determining whether both sides can capitalize on this momentum to build a lasting and mutually beneficial alliance.
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