New Delhi, Jan 20 (PTI) India and the European Union are on the cusp of a "historic trade agreement" that would create a market comprising two billion people accounting for almost a quarter of the global
GDP, European Commission President Ursula von der Leyen said on Tuesday, days before her trip to New Delhi.
In an address at the World Economic Forum in Davos, von der Leyen elaborated on the current "geopolitical shocks" and how the 27-nation bloc is responding to them, asserting: "It is time to seize this opportunity and build a new independent Europe." President of the European Council Antonio Costa and von der Leyen will be in India from January 25 to 27 to grace the Republic Day celebrations as chief guests and hold summit talks with Prime Minister Narendra Modi.
The two sides are set to announce the conclusion of negotiations on the much-awaited free trade agreement at the India-EU summit on January 27.
In her remarks, von der Leyen said Europe wants to do business with the growth centres of today and the economic powerhouses of this century.
"I will travel to India. There is still work to do. But we are on the cusp of a historic trade agreement. Some call it the mother of all deals. One that would create a market of 2 billion people, accounting for almost a quarter of global GDP," she said in a televised address.
"And, crucially, that would provide a first-mover advantage for Europe with one of the world's fastest growing and most dynamic continents. Europe wants to do business with the growth centres of today and the economic powerhouses of this century," von der Leyen said.
"From Latin America to the Indo Pacific and far beyond, Europe will always choose the world. And the world is ready to choose Europe," she said.
The European Union is India's biggest trade partner with bilateral trade in goods recording USD 135 billion in the financial year 2023-24. The free trade agreement is expected to significantly enhance trade ties.
The proposed agreement is expected to bring a qualitative change in deepening the overall bilateral ties in a range of sectors as well at a time the world is witnessing trade disruptions in view of Washington's tariff policy.
Besides firming up the free trade agreement, the two sides are likely to unveil a defence framework pact and a strategic agenda at the summit.
India and the European Union have been strategic partners since 2004.
The ambitious FTA is being firmed up at a time amid increasing concerns over Washington's trade and tariff policies which have impacted both India and the 27-nation EU.
India and the EU are also expected to unveil a joint comprehensive strategic vision that will govern their relationship for the period 2026-2030.
The EU and India had first launched negotiations for the free trade agreement in 2007, before the talks were suspended in 2013 due to a gap in ambition. The negotiations. The negotiations were relaunched in June 2022.
The proposed Security and Defence Partnership (SDP) will facilitate deeper defence and security cooperation between the two sides.
The Security and Defence Partnership (SDP) will bring interoperability in the defence domain and it will open up avenues for Indian firms to participate in the EU's SAFE (Security Action for Europe) programme, In her address, von der Leyen also touched geopolitical challenges and "opportunities", in remarks that came amid Europe's increasing strain in ties with the Trump administration over Greenland.
"The world may be very different today, without any question. But I believe the lesson is very much the same. That geopolitical shocks can -- and must -- serve as an opportunity for Europe," she said.
"In my view, the seismic change we are going through today is an opportunity, in fact, a necessity to build a new form of European independence. This need is neither new nor a reaction to recent events," she said.
The top European leader said the EU has acted immediately to deal with the challenges.
"We acted immediately. Whether on energy or raw materials, defence or digital -- we are moving fast. But the truth is also that we will only be able to capitalise on this opportunity if we recognise that this change is permanent," she said.
The top EU leader also specifically mentioned the importance of energy and defence sectors.
"Whether on trade or business, capital or energy -- Europe needs an urgency mindset. Our starting point is good. We are home to global champions in fields ranging from wind power to next-generation batteries," she said.
"From aerospace to the industrial machines that are essential to build chips or advanced weapons. Our companies are taking up AI at the same pace as their US peers." Europe, von der Leyen said, is in the race for the key technologies of tomorrow.
"But as global competition gets ruthless, we must show real ambition ' especially in those sectors vital for our independence." "Take defence, for example. We have done more on defence in the last year than in decades before. We have started a surge in defence spending ' up to Euro 800 billion until 2030," she said.
On the EU's ties with the US, von der Leyen said Europe considers American people not just "our allies, but our friends".
"And plunging us into a dangerous downward spiral would only aid the very adversaries we are both so committed to keeping out of the strategic landscape," she said.
"So our response will be unflinching, united and proportional. But beyond this, we have to be strategic about how we approach this issue." The top EU leader, referring to the Russia-Ukraine war, security of Europe is a crucial issue.
"In just over a month, we will mark the fourth anniversary of Russia's war of aggression against Ukraine. Four years on, Russia shows no sign of abating. No sign of remorse. No sign of seeking peace," she said.
"On the contrary. Russia is intensifying its attacks. Killing civilians every day as we speak. Just last week, its bombing of Ukraine's energy infrastructure left millions facing darkness, cold, and water shortages," she said.
"This must end. We all want peace for Ukraine. We recognise President Trump's role in pushing the peace process forward, and we will work closely with the United States. We all agree that Ukraine must therefore be in a position of strength to go to the negotiation table," she said. PTI MPB KVK
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