‘Mother of All Deals’: India-EU FTA Set to Supercharge Manufacturing, Services and Investor Confidence

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Prime Minister Narendra Modi addressing the India Energy Week, highlighting the India-EU Free Trade Agreement as a major boost to manufacturing and services.


Prime Minister Narendra Modi on Tuesday described the India-European Union Free Trade Agreement (FTA) as the “mother of all deals”, underlining its transformative potential for India’s manufacturing and services sectors. Speaking while inaugurating the India Energy Week virtually, the Prime Minister said the long-awaited trade pact will significantly strengthen investor confidence in India and reinforce global supply chains.

The conclusion of negotiations for the FTA is set to be formally announced at the India-EU Summit in Delhi, marking a historic breakthrough after years of complex and often stalled discussions.

Boost for Manufacturing and Services

Prime Minister Narendra Modi says the India-EU Free Trade Agreement, dubbed the “mother of all deals”, will boost manufacturing, expand services, strengthen investor confidence, and reinforce global supply chains.



PM Modi emphasised that the agreement will give a major push to manufacturing in India while also expanding services-related sectors. According to him, the FTA will open new avenues for Indian industries to integrate more deeply with European markets, enhancing exports and attracting fresh investments.

“…this trade deal will not only boost manufacturing in India but also further expand sectors related to services. This free trade agreement will further strengthen confidence in India for every business and investor in the world,” the Prime Minister said.

Sectors such as IT and digital services, consulting, finance, engineering services and logistics are expected to gain from smoother market access and regulatory cooperation between India and the EU.

‘Mother of All Deals’: Scale and Global Impact

India-EU FTA ‘Mother of All Deals’ to Boost Manufacturing, Services: PM Modi



Calling it a deal of unprecedented scale, PM Modi said the India-EU FTA represents synergy between two of the world’s largest economic blocs. Together, India and the EU account for around 25% of global GDP and nearly one-third of global trade.

“People around the world are discussing it as the ‘Mother of All Deals’. This agreement has brought massive opportunities for 1.4 billion Indians and millions of people in European countries,” he noted.

The Prime Minister added that the agreement sets a powerful global example of cooperation between major democracies at a time of economic uncertainty and shifting trade alliances.

Key Sectors Set to Benefit

Several labour-intensive and export-oriented sectors in India are expected to see immediate gains from the trade pact. These include:

  • Textiles and garments

  • Gems and jewellery

  • Leather and footwear

  • Jute and handicrafts

  • Marine products and sports goods

Lower tariffs, easier access to European markets, and clearer trade rules could help Indian exporters become more competitive globally. At the same time, India is likely to gradually open sensitive sectors such as automobiles and alcoholic beverages, reflecting the EU’s strong interest in these areas.

Strengthening Global Supply Chains

PM Modi said the India-EU FTA complements India’s recent trade agreements with the UK and Australia. Together, these deals are expected to diversify trade routes, reduce over-dependence on single markets, and strengthen global supply chains.

The agreement comes at a crucial time when global trade is being reshaped by geopolitical tensions, protectionist policies, and supply-chain disruptions. Both India and the EU see value in building resilient, transparent and rules-based trade networks.

Shared Democratic Values

Beyond economics, the Prime Minister highlighted that the trade deal also reinforces shared values between India and the EU, including democracy, rule of law and respect for international norms.

“Along with trade, the India-EU trade deal also strengthens India and the EU’s shared commitment to democracy and rule of law,” Modi said, adding that these principles form the foundation of long-term and trusted partnerships.

Decades in the Making

The India-EU FTA has been decades in the making. Negotiations first began in 2007 but were suspended in 2013 due to disagreements, particularly over market access for automobiles and other sensitive sectors.

After renewed efforts and consolidation of chapters, both sides have now completed talks on 21 chapters. According to officials, the legal scrubbing of the agreement will take four to five months. The deal is expected to come into force by early next year after ratification by the European Parliament.

Strategic Context: US Tariffs and China Challenge

The urgency behind the deal has increased amid dramatic shifts in global trade dynamics. India is facing steep tariffs in the US market, while the EU continues to face trade uncertainties with Washington despite a bilateral deal.

Another key driver is the shared challenge posed by China. Indian industry has struggled with pricing pressures, especially in sectors like solar energy, where China dominates global manufacturing. Similarly, the EU is concerned about its heavy dependence on China for critical technologies.

By deepening trade ties, India and the EU aim to reduce strategic vulnerabilities and build alternative, trusted supply chains.

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