India–EU ‘Mother of All’ Trade Deal Accelerates Shift Away From U.S. Amid Trump Tariffs
The historic India–EU free trade agreement, hailed by Ursula von der Leyen as the “mother of all deals” and by Prime Minister Modi as deepening ties between the two democracies, cuts Indian tariffs on imported EU autos from as high as 110% to 10%, reduces levies on EU wine, beer and olive oil, and opens easier EU market access for Indian farmers, small businesses and exporters in textiles, apparel, leather, footwear, gems and jewelry, handicrafts and engineering goods. Observers say the breakthrough — coming as EU–India trade (~$137 billion in 2024–25) now slightly exceeds U.S.–India trade (~$132 billion) — is accelerated by the unpredictability and cost of doing business with the U.S. under Trump’s tariffs and reflects a broader global rush to bilateral deals, including moves by the U.K. toward China.
📌 Key Facts
- The EU–India free trade agreement includes steep tariff cuts: Indian tariffs on imported EU autos will fall from as high as 110% to 10%, with significant cuts also for EU wine, beer and olive oil.
- The deal promises easier EU market access for Indian farmers, small businesses and exporters of textiles, apparel, leather, footwear, gems and jewelry, handicrafts and engineering goods.
- EU–India trade in 2024–25 was about $137 billion, now slightly exceeding U.S.–India trade of roughly $132 billion.
- Political leaders framed the pact as a major milestone: EU Commission President Ursula von der Leyen called it the “mother of all deals,” and Prime Minister Narendra Modi said it deepens ties between the “world’s two largest democracies”; leaders implicitly linked the breakthrough to unpredictability from U.S. tariff policies under President Trump.
- The agreement is presented as part of a broader global realignment toward bilateral trade deals as doing business with the U.S. has become more expensive and less predictable under Trump’s tariffs; the coverage also notes U.K. Prime Minister Keir Starmer’s trip to Beijing to seek a “strategic and consistent” relationship with China.
📰 Source Timeline (2)
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- Detailed tariff cuts: Indian tariffs on imported EU autos will drop from as high as 110% to 10%, alongside cuts on EU wine, beer and olive oil.
- Sector specifics: India touts easier EU market access for its farmers, small businesses and exporters of textiles, apparel, leather, footwear, gems and jewelry, handicrafts and engineering goods.
- Comparative trade data: EU–India trade in 2024–25 is about $137 billion, now slightly exceeding U.S.–India trade of roughly $132 billion.
- Political framing: Ursula von der Leyen publicly calls the FTA the “mother of all deals,” and Modi emphasizes it deepens ties between the “world’s two largest democracies,” while leaders implicitly link the breakthrough to Trump’s tariff unpredictability.
- Context on broader realignment: The article situates the deal within a wider global rush to bilateral agreements as doing business with the U.S. becomes more expensive and less predictable under Trump’s tariff regime, and notes U.K. Prime Minister Keir Starmer’s trip to Beijing to seek a 'strategic and consistent' relationship with China.