India and the European Union (EU) are set to establish a major security and defence partnership, a move seen as part of the EU’s broader effort to strengthen ties with emerging global players. European Commission President Ursula von der Leyen announced the initiative on Friday ahead of her meeting with Indian Prime Minister Narendra Modi in New Delhi. “We are exploring a future Security and Defence Partnership with India in the mould of the partnerships we have with Japan and South Korea,” von der Leyen said, emphasizing the need to counter shared threats such as cross-border terrorism, maritime security challenges, and cyber-attacks.
This agreement comes as both India and the EU look to secure their interests amid China’s growing influence in the Indo-Pacific. Modi underscored this by stating, “We will work together on triangular development projects for sustainable and inclusive development in the Indo-Pacific region and Africa.” The EU also welcomed India’s interest in joining the Permanent Structured Cooperation (PESCO), a key European defence initiative, as well as negotiations for a Security of Information Agreement to facilitate greater intelligence sharing.
A Renewed Push for a Trade Deal
Trade relations between India and the EU have witnessed significant growth, with bilateral trade reaching $137 billion in 2023-24, an increase of 90% since 2014. The EU remains India’s largest trading partner, accounting for 12% of India’s total trade, yet India makes up only 2.2% of the EU’s trade portfolio due to high tariffs and regulatory barriers. The EU is pushing for a free trade agreement (FTA) to lower tariffs on automobiles, wines, and spirits, while India seeks greater access for its pharmaceutical, textile, and leather industries.
Von der Leyen highlighted the importance of finalizing the deal, stating, “A free trade agreement between the EU and India would be the largest deal of this kind anywhere in the world.” However, challenges remain. India is resisting EU demands to slash import duties on cars and alcoholic beverages, while the EU remains reluctant to ease visa restrictions for Indian professionals. Additionally, New Delhi opposes the 20-35% carbon tax imposed by the EU on industrial goods like steel, cement, and aluminum, arguing that it unfairly penalizes Indian exports.
Geopolitical Concerns and the Russia Factor
Beyond trade and security, discussions also covered geopolitical concerns, particularly Russia’s ongoing war in Ukraine. Historically close to Russia as a key supplier of military hardware, India has maintained a neutral stance despite Western pressure to distance itself from Moscow. The EU delegation aimed to gauge India’s position on the conflict, particularly as Modi continues to balance relations with both the West and Russia.
The EU’s engagement with India is also seen as part of a broader strategy to hedge against deteriorating ties with the United States. The recent imposition of tariffs by former U.S. President Donald Trump on both allies and adversaries has pushed Brussels to diversify its trade and security partnerships. As von der Leyen noted, “Timing and determination count… We have agreed with Prime Minister Modi to push to get it done during this year.”
The India-Middle East-Europe Corridor (IMEEC)
Another key development was India’s discussions with the EU regarding the India-Middle East-Europe Corridor (IMEEC), a proposed trade and connectivity project designed to rival China’s Belt and Road Initiative. The corridor aims to strengthen supply chains and increase economic cooperation between India, the Middle East, and Europe. The initiative is particularly crucial as global supply chains face disruptions due to geopolitical tensions, including the war in Ukraine and the broader U.S.-China rivalry.
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As India and the EU deepen ties in security, trade, and infrastructure, the ongoing negotiations reflect a shifting global order. With the EU looking beyond traditional alliances and India positioning itself as a key economic and strategic player, the partnership could mark a significant shift in global geopolitics. However, the success of these initiatives will depend on overcoming economic barriers and geopolitical complexities in the months ahead.