India and EU Ink Landmark Trade Deal, Creating a $6 Trillion Market and Rattling US

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In a major breakthrough, India and the European Union have signed a historic trade deal, dubbed the 'mother of all agreements,' which is expected to create a massive market of over 1.9 billion consumers, accounting for nearly a quarter of the world's GDP. The deal, announced on Tuesday, comes after almost nine years of negotiations and marks a significant milestone in the bilateral trade relationship. The agreement, which is set to boost trade between India and EU member states, has raised eyebrows in the US, with Treasury Secretary Scott Bessent reiterating concerns that India's oil trade with Russia finances the war in Ukraine. The India-EU trade deal is a game-changer, as it will eliminate or reduce tariffs on 96.6% of EU goods exports, saving up to €4 billion per year in duties on European products. Key benefits for EU exporters include a competitive advantage, privileged access to India's financial and maritime services, simplified customs procedures, and protection of EU intellectual property. For Indians, the deal means cheaper imports of European goods, including wines, chocolates, and processed foods. Tariffs on EU cars will gradually decrease from 110% to 10%, while duties on wines will be reduced from 150% to 20%. Tariffs on processed foods, including pasta and chocolate, will be completely eliminated. The trade agreement is expected to benefit labour-intensive sectors such as textiles, leather, chemicals, electronics, and jewellery, which do not compete with European manufacturers. This will provide a much-needed boost to India's exporters, who currently face tough competition from duty-free and quota-free shipments from least developed countries. Prime Minister Narendra Modi hailed the deal as a 'perfect example of a partnership between two major economies' and said it will bring major opportunities for the public in India and Europe. The agreement is seen as a strategic counterweight to the US's tariff-heavy approach, which has left many nations affected. EU Commission President Ursula von der Leyen hailed the signing of the deal, saying history has been made today. 'We have concluded the mother of all deals. We have created a free trade zone of two billion people, with both sides set to benefit,' she said, adding that this is only the beginning of a stronger strategic relationship between the two sides.