‘The mother of all deals’: EU and India sign major trade agreement amid tensions with US

The European Union and India have announced a landmark trade deal after nearly two decades of on-off talks, the BBC writes.

“We did it, we delivered the mother of all deals,” European Commission President Ursula von der Leyen said at a media briefing in Delhi. Indian Prime Minister Narendra Modi called the deal “historic.”

It will allow free trade of goods between the bloc of 27 European states and the world’s most populous country, which together make up nearly 25% of global gross domestic product.

The pact is expected to significantly reduce tariffs and expand market access for both sides.

The European Commission said the agreement would eliminate tariffs on most exports of chemicals, machinery and electrical equipment, as well as aircraft and spacecraft, following phased reductions. Significantly, duties on motor vehicles, currently as high as 110%, would be cut to 10% under a quota of 250,000 vehicles.

Brussels said the agreement would support investment flows, improve access to European markets.

Delhi said almost all of its exports would get “preferential access” into the EU, with textiles, leather, marine products, handicrafts, gems and jewellery set to see a reduction or elimination of tariffs.

Delhi and Brussels have also agreed on a mobility framework that eases restrictions for professionals to travel between India and the EU in the short term.

The trade deal comes as both India and the EU contend with economic and geopolitical pressure from the US.