India-EU Summit talks to focus on trade, defence and mobility pacts

India and the European Union are set to announce the conclusion of a free trade agreement, firming up of a defence partnership pact and a framework for mobility of Indian professionals at the summit talks next week, diplomatic sources said on Monday.

European Council President Antonio Costa and European Commission President Ursula von der Leyen will be the chief guests at the Republic Day celebrations on January 26, and the India-EU summit will be held the next day.

A military contingent from the EU, featuring the military staff flag and flags of Operations Atalanta and Aspides, the naval operations of the grouping, will feature at the Republic Day parade.

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It will be the EU’s first participation in such an event outside of Europe, the sources said.

Pressing global challenges, including the Russia-Ukraine war, the situation in the Middle East and the political developments in Venezuela, will be among the global issues that the two sides are likely to delve into at the summit, they added.

The EU leaders will be accompanied by a 90-member delegation that will include foreign and security policy chief Kaja Kallas, trade commissioner Maros Sefcovic and director generals handling trade, energy and industrial policy.

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The European Union is India’s biggest trade partner, with bilateral trade in goods at USD 135 billion in the financial year 2023-24.

The free trade agreement is expected to significantly enhance trade ties.

The two sides are expected to adopt a document to announce the conclusion of the negotiations for the free trade agreement, billed as India’s biggest such deal in recent history.

Following this, the two sides will initiate the process of legal scrubbing and related processes for the signing of the trade deal.

At the first stage, the European Parliament will have to vote on it, and then the European Council will have to green-light the deal for Trade Commissioner Sefcovic to sign it with his Indian counterpart, the sources said.

The ambitious FTA is being firmed up amid increasing concerns over Washington’s trade and tariff policies which have impacted both India and the 27-nation EU.

India and the EU are also expected to unveil a joint comprehensive strategic vision that will govern their relationship for the period 2026-2030.

The sources said both sides are still holding negotiations to find common ground on contentious issues like CBAM (Carbon Border Adjustment Mechanism), which is a framework for tariffs on carbon-intensive products such as steel and cement.

The EU has a principled position on CBAM and has not changed the provisions for the US and other partners, the sources said, adding both sides are working on a “compromise solution” on this sensitive issue.

Work is in progress to find a way out on the inclusion of climate-related standards under the Paris Agreement, they said.

There has been progress on issues relating to the agriculture sector as both sides have “marked and mapped each other’s red lines” over it.

India has been taking a tough approach on dairy and farm products, the sources said.

An agreement has already been reached on wines and spirits and there could be tariff-rate quotas for the automobile sector, they added.

It is learnt that both sides are looking at narrowing differences on steel.

The EU and India had first launched negotiations for the free trade agreement in 2007, before the talks were suspended in 2013 due to a gap in ambition.

The negotiations were relaunched in June 2022.

The proposed Security and Defence Partnership (SDP) will facilitate deeper defence and security cooperation between the two sides.

The SDP will bring interoperability in the defence domain and it will open up avenues for Indian firms to participate in the EU’s SAFE (Security Action for Europe) programme.

SAFE is the EU’s Euro 150 billion financial instrument designed to provide financial support to member states to speed up defence readiness.

At the summit, India and the EU are also set to launch the negotiations for a Security of Information Agreement (SOIA).

The SOIA is expected to boost industrial defence cooperation between the two sides.

The memorandum of understanding on facilitating the mobility of Indian workers to Europe is expected to be another key outcome of the summit.

It will provide a framework for advancing mobility initiatives by EU member states with India, the sources said.

France, Germany and Italy are among European nations that have migration and mobility partnerships with India.

The two sides are also expected to ink a number of other agreements to provide for deeper cooperation in several other sectors.

(Except for the headline, this story has not been edited by Firstpost staff.)