Recent developments in the West have made the European Union realise that a stronger partnership with India is essential.With US President Donald Trump
threatening a 25 per cent tariff on European imports and China’s economic expansion reshaping global trade, Europe finds itself at a critical juncture.Strengthening ties with India offers the EU a means to secure its economic and strategic interests in an increasingly unpredictable world.The significance of this alliance has been highlighted by European Commission President Ursula von der Leyen’s two-day visit to India, commencing Thursday, accompanied by a large delegation of senior EU officials.AdvertisementThis visit, which will include meetings with Indian Prime Minister Narendra Modi and top ministers, signifies a major push towards deepening EU-India relations.How EU-India be a mutually beneficial partnershipTrade has long been the foundation 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 increase of around 90 per cent over the past decade.India’s growing economy, projected to be the third-largest by 2030, presents vast opportunities for European businesses looking to expand.For the EU, India serves as both an important export market and a crucial source of goods. European industries, particularly in automobiles, wines, and spirits, see India as an essential destination amid increasing global protectionism.Editor’s Picks1EU adopts 16th Russia sanctions package, targets crypto exchange2Trump wants Europe to buy food from America but Brazil could be a problemAdditionally, India’s “Make in India” initiative and its drive to become a manufacturing powerhouse provide avenues for European investment and trade diversification.Conversely,
India sees the EU as a vital partner in reducing its reliance on China. European technology, infrastructure, and investment can support India’s ambitious development plans, including its “Developed India” (Viksit Bharat) vision and the goal of boosting total exports to $2 trillion by 2030.AdvertisementDespite these economic incentives, challenges remain. Trade negotiations have been ongoing for nearly two decades without a conclusive free trade agreement.Regulatory barriers, intellectual property concerns, and bureaucratic complexities continue to hinder progress. Nevertheless, both sides recognise the importance of overcoming these obstacles to unlock the full potential of their economic relationship.What EU-India have in commonBeyond trade, the EU and India share strategic concerns, particularly in the Indo-Pacific region. The growing influence of China, cyber threats, and maritime security challenges have prompted the EU to enhance its engagement in the region.India, with
its increasing naval capabilities and strategic partnerships, is a key player in maintaining regional stability.The EU-India Trade and Technology Council (TTC), established in 2022, serves as a platform for cooperation in key areas such as artificial intelligence, cybersecurity, digital governance, and green technologies.The TTC aims to strengthen supply-chain resilience, economic security, and technological collaboration — critical areas for both partners amid global uncertainties.AdvertisementThe
India-Middle East-Europe Economic Corridor (IMEC) is another crucial initiative that underscores India’s strategic importance to Europe. This project aims to enhance connectivity between India and Europe via the Gulf states, Israel, and Jordan, reducing dependence on traditional trade routes like the Suez Canal.The EU sees this corridor as a significant step in diversifying its supply chains and reducing vulnerabilities.Is India the key to balancing power in an uncertain world?The EU’s increased focus on India is also influenced by global political shifts. The ongoing conflict in Ukraine has strained EU-Russia relations, while India’s neutral stance on the war has positioned it as a potential mediator.Despite India’s historical ties with Russia, the EU has chosen to engage with India rather than isolate it, recognising its growing geopolitical influence.While differences remain — especially regarding India’s continued economic ties with Russia — Brussels understands that India follows a policy of multi-alignment.AdvertisementRather than pressuring India to sever its Russian ties, the EU is seeking ways to work with India on shared priorities, such as securing supply chains for critical minerals and collaborating on defense initiatives.Furthermore, India’s role as a leader of the Global South offers the EU opportunities for trilateral cooperation. India’s engagement with African and Latin American nations, particularly in digital transformation and infrastructure projects, aligns with Europe’s foreign economic policy goals.The EU sees India as a bridge to these regions, opening new avenues for investment and collaboration.However, success will depend on both sides’ ability to move beyond rhetoric and deliver tangible results.AdvertisementFrom finalising a long-delayed trade agreement to strengthening regional security partnerships, the coming years will be crucial in shaping EU-India relations.With inputs from agenciesMore from Explainers
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EU chief in New Delhi: Why Europe needs India now more than ever
