India and the European Union (EU) are set to sign a Free Trade Agreement (FTA) on December 16, 2026, according to diplomatic sources. This agreement will be a key highlight of Prime Minister Narendra Modi's series of international visits in December, which include trips to Canada, the U. S., and Belgium, where other trade agreements are also in the pipeline.
The India-EU FTA, described as the 'mother of all deals' by leaders from both sides, has already garnered majority approval within Europe. This means it will bypass the need for individual ratification by each EU member state once the European Council gives its approval. Following the signing, the agreement will be presented to the European Parliament, a process expected to take one to two months, with implementation anticipated in early 2027.
Negotiations for this significant trade pact resumed in June 2022 after a prolonged pause and concluded in January 2026. The deal has been crafted to exclude contentious issues, focusing instead on achievable goals, which has facilitated its broad support across Europe.
Prime Minister Modi's itinerary begins with a visit to Canada around December 12, ahead of the G-20 Summit in Miami. Canadian Prime Minister confirmed the visit, noting substantial progress in trade negotiations. The importance of the India-Canada relationship was emphasized, highlighting various areas of cooperation, including trade and security.
India's High Commissioner to Canada, Dinesh Patnaik, echoed this sentiment, stating that the India-Canada FTA is expected to be finalized by November, with Modi's visit in December set to formalize the agreement. Commerce Secretary Rajesh Agrawal also confirmed that this timeline aligns with India's expectations.
Following his Canadian visit, Modi will attend the G20 meeting in Miami, where the India-U. S. Interim Agreement on trade and a broader Bilateral Trade Agreement (BTA) will be discussed. Both agreements have faced delays. Initially announced in February 2025, the BTA was intended for completion by fall 2025 but was derailed by the U. S. imposing 50% tariffs on Indian imports in mid-2025.
In February 2026, both nations issued a joint statement committing to an Interim Agreement by March-April 2026, while continuing efforts on the BTA. However, these agreements remain unresolved, further complicated by recent U. S. legislation threatening tariffs of up to 100% on India due to its import of Russian crude oil and natural gas.
The December 16 signing of the India-EU FTA marks a significant milestone in India's trade diplomacy, potentially paving the way for enhanced economic cooperation with Europe. As Modi embarks on his diplomatic tour, the outcomes of these negotiations will be closely watched, given their potential impact on India's global trade relations.
