German Chancellor Friedrich Merz has said that the European Union and India may sign a long-awaited free trade agreement as early as the end of January. The announcement came after his meeting with Prime Minister Narendra Modi during his visit to Ahmedabad on Monday.
Merz said senior EU leaders are expected to visit India later this month. If negotiations are completed in time, the deal could be formally signed during that visit.
- Presidents of the European Commission and European Council may travel to India for the signing
Trade talks have progressed faster than earlier expected
The agreement was earlier planned for completion by the end of the year
This is Merz’s first visit to India since taking office as German chancellor. German government sources said talks between Merz and Modi were “very intensive,” raising hopes of an early conclusion.
India’s Commerce and Industry Minister Piyush Goyal also confirmed that negotiations are nearing their final stage.
Why the deal matters now
Merz warned that global trade is facing a rise in protectionist policies that are affecting both European and Indian economies. Although he did not name specific countries, his remarks come amid growing trade tensions worldwide.
The US has been pressing India to reduce Russian oil and gas imports
China’s export controls have disrupted global supply chains, including Europe’s auto sector
The EU is looking to diversify trade partnerships and reduce reliance on China
For the EU, a deal with India would follow recent progress on a trade pact with South America’s Mercosur bloc.
Expanding cooperation beyond trade
Germany is also seeking stronger cooperation with India in areas beyond trade, particularly security and technology.
During the visit, both countries signed memorandums of understanding covering:
Critical minerals
Healthcare cooperation
An artificial intelligence innovation centre
“These agreements will give fresh momentum to our partnership,” Prime Minister Modi said at a joint press conference.
While India continues to maintain strong defence and energy ties with Russia, the proposed EU–India free trade agreement would mark a major step in reshaping global trade relationships amid rising geopolitical uncertainty.
