Highlights
Her visit to the country marks a significant diplomatic moment ahead of the 77th Republic Day celebrations on January 26. Experts believe her visit to India will firm up a series of big-ticket initiatives expected to significantly expand two-way ties.
She was received by Minister of State for Commerce and Industry Jitin Prasada at the Indira Gandhi International Airport.
President of the European Council Antonio Costa and von der Leyen will hold summit talks with Prime Minister Narendra Modi in New Delhi on January 27 amid increasing global concerns over disruptions caused by the Donald Trump administration’s economic and security policies.
Antonio Costa and von der Leyen to attend Republic Day celebrations
Costa will land in the national capital on Sunday. The two European Union leaders will grace the Republic Day celebrations as the chief guests on January 26.
“Charting the next phase of the India-EU Strategic partnership. A warm welcome to the President of the European Commission Ursula von der Leyen @vonderleyen, on her State Visit to India,” External Affairs Ministry spokesperson Randhir Jaiswal said on ‘X’.
“As the world’s two largest democracies, India and the EU share a partnership rooted in mutual trust and shared values,” he added.
The ties between India and the EU have been on an upswing in the last few years.
Antonio Costa and von der Leyen summit talks with PM Modi
An announcement could follow PM Modi’s meeting with Antonio Costa and Ursula von der Leyen, who will co-chair an India-EU summit in the country from January 25 to 28, one of the Indian government sources said.
At the summit, India and the EU are set to announce the conclusion of the much-awaited free trade agreement and firm up a strategic defence partnership pact and a framework for mobility of Indian professionals.
Speaking earlier this week at the World Economic Forum (WEF) in Switzerland’s Davos, von der Leyen said, “We are on the cusp of a historic trade agreement (with India).” Commerce Minister Piyush Goyal has described the proposed free trade agreement as “the mother of all deals”, as New Delhi and Brussels look to expand market access amid tightening global trade conditions driven by US tariffs and Chinese export restrictions.
EAM met ambassadors from European Union member states
On Thursday, External Affairs Minister S Jaishankar met ambassadors from European Union member states and underlined the need for closer cooperation to “derisk the world economy” in response to unpredictable US policies. He said stronger India-EU engagement would help build resilient supply chains, provide global public goods such as humanitarian assistance and disaster relief, anti-piracy efforts and development projects, and contribute to global stability through enhanced trade, mobility and security cooperation.
India-Europe Trade Pact: Sectors likely to be impacted
Both India and the European Union have been impacted by the trade approach of US President Donald Trump. India faces tariff rates of up to 50 per cent on certain exports to the United States, while the EU is yet to ratify a trade arrangement with Washington that has been criticised as imbalanced.
India and the European Union are expected to announce the conclusion of protracted negotiations for a free trade pact on Tuesday, Reuters reported, as said by two Indian and EU government sources.
The deal will open the way for reduced tariffs on European cars and wine and an expanded market for Indian electronics, textiles and chemicals.
The two sides expect to sign a security and defence pact – Europe’s third in Asia after deals with South Korea and Japan – along with a mobility agreement covering high-skilled workers and students.
A key concern for New Delhi is a range of non-tariff barriers, such as the EU’s newly introduced carbon levies on imports of goods, including steel, aluminium and cement.
The bloc has also withdrawn some tariff reductions granted to India as Brussels unwinds special tariff treatment for select countries under its Generalised System of Preferences (GSP).
The suspension, extended this month for another two years, will hit Indian exports worth $1.95 billion, India’s trade ministry said on Friday, although an FTA would help offset that.
It could also help offset losses for Indian textile and jewellery exporters in the U.S., Ajay Srivastava, founder of the Delhi-based think tank Global Trade Research Initiative, as reported by Reuters, said.
“An India–EU FTA would cut tariffs on textiles, garments and leather, letting Indian exporters compete more evenly with Bangladesh and Vietnam,” he said.
The EU imports nearly $125 billion of textiles annually, where India holds a 5–6% share versus China’s 30%, highlighting the potential gains from an FTA amid rising U.S. tariffs.
India’s autos, electronics, textiles, pharmaceuticals and chemicals are likely to emerge as key beneficiaries of a potential India–EU FTA, according to Jefferies.
Some agricultural items have been excluded from negotiations, an Indian trade ministry official said earlier.
EU India’s largest trading partner in goods
The EU, as a bloc, is India’s largest trading partner in goods. For the financial year 2024-25, India’s total trade in goods with the EU was worth about USD 136 billion, with exports around USD 76 billion and imports at USD 60 billion.
Together, India and the European Union represent around a quarter of the global population and gross domestic product. According to EU data, bilateral trade in goods touched 120 billion euros in 2024, marking an increase of nearly 90 per cent over the past decade, while trade in services amounted to an additional 60 billion euros.
(With inputs from agencies)