India and the European Union will sign the ambitious free trade agreement by the end of this year, top EU leader Ursula von der Leyen said on Wednesday after holding talks with Prime Minister Narendra Modi that largely focused on boosting two-way economic engagement against the backdrop of a fragile geopolitical environment.
In the meeting, held on the sidelines of the G7 summit in this French commune, the two sides also resolved to step up security and defence cooperation. Besides Von der Leyen, the President of the EU Commission, the meeting was joined by European Council President Antonio Costa.
The leaders stressed the expeditious signing and implementation of the trade deal as it would unlock huge opportunities for trade and investment and contribute towards diversification of supply chains, particularly in the current turbulent geopolitical context, according to an Indian readout.
India and the EU announced the conclusion of the negotiations for the free trade agreement -- billed as the "mother of all deals" -- following the summit meeting between PM Modi and the top EU leadership on January 27.
The free trade agreement that will account for almost a quarter of the global GDP will reduce tariffs on 99 per cent of Indian exports to the EU and cut duties on over 97 per cent of the EU's exports to India, according to officials.
The EU estimated that the deal will cut up to four billion euros in annual tariffs for European exporters.
"Since we have concluded the mother of all trade deals, we have been moving fast to deliver on our commitments. We will sign the Free Trade Agreement by the end of the year. And accelerate work on an investment agreement," Von der Leyen said on social media.
"We will also step up security & defence cooperation. And join forces for better connectivity by advancing IMEC, the India–Middle East–Europe Corridor," she said. Costa also made an identical social media post.
India and the EU announced concluding negotiations for the mega trade deal at their summit meeting in January in New Delhi.
The prime minister said he and the EU leaders discussed how to further deepen economic linkages.
"At the start of this year, India was proud to host them for our Republic Day celebrations. This has been a great time for India-EU ties as we have concluded the Free Trade Agreement," he said on social media.
"During our talks, we discussed how to further deepen economic linkages in the times to come. Our growing cooperation can play an important role in strengthening peace, stability and prosperity in today's global environment," he added.
The Ministry of External Affairs (MEA) said PM Modi and EU leaders recalled the landmark 16th India-EU summit of January and welcomed the "remarkable progress" made in the bilateral relations since then.
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.
"The leaders emphasised the recent conclusion of negotiations for the India-EU free trade agreement as a historic achievement and stressed its expeditious signing and implementation, which would unlock huge opportunities for trade and investment and contribute towards diversification of supply chains, particularly in the current turbulent geopolitical context," it said.
PM Modi, Costa and Von der Leyen also discussed the progress on the joint India-EU comprehensive strategic agenda that was endorsed by the two sides in January.
"As the world's two largest democracies, with open market economies and pluralistic societies, India and the EU share a relationship based on trust, shared values and a common vision for the future," the MEA said.
"The leaders discussed the progress on the joint India-EU Comprehensive Strategic Agenda endorsed in January 2026 and shared the sentiment that it would further reinforce India-EU strategic partnership and deliver mutually beneficial and transformative outcomes," it said.
At the January summit, the two sides unveiled a transformative five-year agenda to largely leverage trade and defence in protecting the rules-based world order.
The prime minister and the EU leaders also deliberated on the situation in West Asia and welcomed the peace initiative between the US and Iran.
"Exchanging views on regional and global issues of mutual interest, the leaders welcomed the developments in West Asia," the MEA said.
"They reiterated their shared commitment to shaping a resilient multipolar global order that contributes to peace and stability, prosperity and sustainable development," it said in a statement.