Europe on cusp of 'mother of all deals’ with India, says Ursula von der Leyen

Davos: European Commission President Ursula von der Leyen said the European Union is close to finalising what she described as the “mother of all deals” with India — a landmark trade agreement that could become one of the largest of its kind globally.

Speaking at the World Economic Forum in Davos, von der Leyen said the deal could unite 2 billion people through trade.

She said, "Right after Davos, 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."

She added the move 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," she said.

“Europe will always choose the world, and the world is ready to choose Europe,” von der Leyen said.

She also pointed to the recently signed free-trade agreement between the EU and the Mercosur bloc of South American nations, including Brazil and Argentina, which together represent nearly one-third of global GDP and a market of around 700 million people.

The agreement, she said, sends a strong signal that Europe is backing free trade over tariffs, while actively de-risking its economy and diversifying global supply chains.

The European Union and India have been negotiating a comprehensive free trade agreement for more than a decade, with talks first launched in 2007.

Negotiations stalled in 2013 due to differences over market access, tariffs, data protection, intellectual property rights and labour and environmental standards.

Talks were formally relaunched in 2022 as both sides sought to reduce reliance on China. The proposed deal aims to significantly cut or eliminate tariffs on goods, ease market access for services, boost investment flows and strengthen cooperation in areas such as digital trade, clean energy, manufacturing and critical supply chains.

The EU is currently one of India’s largest trading partners, while India is a key growth market for European companies across sectors including automobiles, aviation, pharmaceuticals, luxury goods, renewable energy and technology.

Meanwhile, India and US trade talks have been in a gridlock because of long-standing disagreements over tariffs, market access and policy priorities.