Business

European Council President Antonio Luis Santos da Costa and European Commission President Ursula von der Leyen will be the main guests at India's Republic Day celebrations next Monday. Along with enjoying state banquets and the event's ceremonial activities, the two leaders will focus on an important issue: advancing free trade talks with India, the third-largest economy in Asia. This comes at a challenging time for Europe, as President Donald Trump has recently hinted at escalating trade tensions with European allies due to their opposition to a US takeover of Greenland, although he later backed off from that stance. The choice of these guests sends a significant diplomatic message from India, signaling that Delhi is speedily strengthening its strategic and trade relationships globally, especially as the deadlock over Washington's 50% tariffs on India continues into the new year. Chietigj Bajpaee from the Chatham House think tank in London told the BBC, “[It] sends a signal that India maintains a diversified foreign policy… and that it is not beholden to the whims of the Trump administration.” Reports suggest that the trade deal might be announced as soon as January 27 when leaders from both sides gather for a high-level summit. Both von der Leyen and India’s Trade Minister Piyush Goyal have referred to it as the “mother of all deals,” emphasizing the importance of finalizing negotiations that have been ongoing for nearly two decades. This agreement will be India’s ninth free trade agreement (FTA) in just four years, following similar deals with the UK, Oman, New Zealand, and other nations. For Brussels, this agreement comes after the recent trade deal with the Mercosur trading bloc and agreements with Japan, South Korea, and Vietnam. Sumedha Dasgupta, a senior analyst at the Economist Intelligence Unit, noted, “Both sides now seek reliable trade partners, as threats arising out of the geopolitics have created a tumultuous environment for commerce. The urge is equally strong - for India to offset US tariff issues, and the EU to offset trade dependence on China which it considers unreliable.” The deal will also represent a significant step in moving away from India's traditionally protectionist stance, according to Dasgupta.