A Defining Milestone: Amit Shah Praises India‑EU Free Trade Agreement as Testament to PM Modi’s Global Vision

The recently concluded India-European Union Free Trade Agreement (FTA) represents a historic milestone in bilateral economic relations. Signed during high-level talks in New Delhi in January 2026, the pact is being hailed as a transformative development for both India and the EU. Leaders from both sides have described it as a defining moment in global trade, opening the door for deeper economic integration while strengthening strategic partnerships in a rapidly evolving global landscape.

Union Home Minister Amit Shah (Credits: Amit Shah/X) | News18

Strategic Significance and Global Implications

Prime Minister Narendra Modi described the agreement as the “mother of all deals,” emphasizing its potential to create a trade zone encompassing nearly 2 billion people. The FTA is seen not only as an economic milestone but also as a strategic maneuver that reinforces stability in global trade, diversifies supply chains, and strengthens India’s position as a key partner on the world stage. Union Home Minister Amit Shah praised the deal as a defining moment that showcases India’s diplomatic acumen and PM Modi’s visionary leadership in global economic affairs.

European leaders also welcomed the agreement. European Commission President Ursula von der Leyen noted that the pact is among the EU’s most ambitious trade agreements, designed to deliver mutual benefits while enhancing bilateral cooperation in multiple sectors. Analysts have highlighted that while the FTA is a major accomplishment, its success will ultimately depend on effective implementation, infrastructure readiness, and supportive domestic policies in both regions.

Key Features of the Agreement

The India-EU FTA provides unprecedented market access for goods and services. The agreement aims to reduce or eliminate tariffs on the majority of traded goods, facilitating smoother trade flows and making products from both regions more competitive. Indian exports such as textiles, leather goods, gems and jewellery, marine products, and engineering goods will benefit from preferential or zero-duty access to the EU market, boosting competitiveness and employment in key sectors.

At the same time, sensitive sectors such as dairy, cereals, and poultry have been protected from tariff reductions to safeguard domestic industries. The agreement also encompasses services, investment protections, regulatory cooperation, and customs facilitation, ensuring that both countries can benefit from enhanced economic integration beyond mere trade in goods.

Economic Impact and Sectoral Opportunities

The FTA is expected to generate significant economic opportunities for India. Textiles and apparel, a traditional strength of Indian manufacturing, will gain improved access to Europe’s $260+ billion market, enhancing competitiveness and export volumes. The gems and jewellery sector, centered in Gujarat and Rajasthan, could see trade nearly double, further boosting employment and income for artisans. Marine products and chemicals will also benefit from reduced tariffs, while engineering goods and leather products gain improved visibility in high-value markets.

In addition to large exporters, micro, small, and medium enterprises (MSMEs) and artisans stand to benefit from the pact. Easier access to EU markets is expected to stimulate entrepreneurship, create jobs, and increase the participation of rural communities and women in trade. Consumers in India may also experience benefits over time, with access to European products such as wines, spirits, olive oil, and medical devices becoming more affordable due to gradual tariff reductions.

Challenges and Considerations

Despite the optimism surrounding the FTA, some challenges remain. Critics have expressed concern about the potential impact on Indian farmers and small producers, emphasizing the need for domestic support systems to ensure they can fully leverage new market opportunities. Analysts stress that infrastructure improvements, compliance mechanisms, and policy support will be critical for realizing the FTA’s potential. Without careful implementation, tariff reductions alone may not translate into tangible benefits for all stakeholders.

Strategic and Geopolitical Dimensions

Beyond economic gains, the India-EU FTA carries strategic significance. By fostering a strong partnership with the EU, India reduces reliance on any single global market and strengthens its position in multilateral trade negotiations. The agreement also provides a framework for cooperation in technology, climate action, and supply chain resilience, aligning with India’s broader vision of sustainable growth and strategic autonomy.

The MGMM Outlook

The India-European Union Free Trade Agreement marks a transformative moment in global trade, signaling India’s growing influence on the international stage. The deal, described by Prime Minister Modi as the “mother of all deals,” offers unprecedented market access for goods and services while safeguarding sensitive domestic sectors like dairy and cereals. Indian exports in textiles, gems and jewellery, marine products, engineering goods, and leather will gain preferential or zero-duty access to the EU, boosting competitiveness, employment, and economic growth across traditional and emerging industries. Simultaneously, the pact strengthens strategic ties with Europe, enhancing cooperation in investment, regulatory standards, and supply chain resilience, thereby reinforcing India’s role as a reliable partner in the global economy.

Beyond large-scale trade benefits, the FTA opens new avenues for micro, small, and medium enterprises, artisans, and rural entrepreneurs. By facilitating easier access to Europe’s $260+ billion market, it encourages entrepreneurship, job creation, and inclusive economic participation, including for women in business. While infrastructure readiness and supportive domestic policies remain critical for realizing the agreement’s full potential, the FTA lays the foundation for sustainable growth, innovation, and deeper economic integration, positioning India to diversify its global trade footprint while enhancing competitiveness across multiple sectors.

(Sources: Hindustan Times, News18, LiveMint)