India–EU Trade Pact to Bolster Long-Term Partnership, Says EU VP Kaja Kallas

India and the European Union have sealed their long-pending free trade agreement, widely described as the “mother of all deals”, signalling a push towards stable and dependable partnerships amid mounting global uncertainty.

Speaking to India Today, European Commission Vice President Kaja Kallas said the pact reflects how both sides are adapting to a rapidly shifting geopolitical environment. The agreement is expected to reduce trade barriers, expand bilateral commerce and deepen economic ties, though Kallas cautioned that its impact will not be immediate as the deal must still clear formal ratification processes in India and the EU.

“As democracies, there are procedures these deals need to go through,” Kallas said. “But we hope it goes fast because it’s beneficial for both parties.” Explaining why the agreement came together now after years of stalled negotiations, Kallas pointed to global trade disruptions and geopolitical realignments.

“The geopolitical landscape definitely helps with this,” she said. “We need to build partnerships with countries that believe in free trade.” She added that reducing overdependence on a limited set of partners is now a shared objective. “Diversifying our trade portfolio on your side as well as our side is our mutual interest,” Kallas said.

The deal, announced by European Commission President Ursula von der Leyen at the World Economic Forum in Davos, drew sharp reactions from sections of the US political establishment, with some accusing Europe of indirectly supporting the Russia–Ukraine war. Kallas dismissed the criticism, saying trade diversification often unsettles existing partners.

“Countries like America don’t like it if we diversify our trade portfolios,” she said. On broader questions of trust and alliances, Kallas acknowledged strain in traditional partnerships, citing recent transatlantic disagreements, including discussions around Greenland.

“The discussions we had over Greenland were not doing any favours to transatlantic ties,” she said, adding that the EU remains focused on cooperation where interests converge. “We are focusing on issues where we can build partnerships with different countries, also with America, where we see eye to eye,” she said.

Rejecting the idea that Europe is more exposed today, Kallas argued vulnerability stemmed from earlier, unrecognised dependencies—particularly on Russian energy and Chinese technology. “Now we understand our vulnerabilities,” she said, pointing to higher defence spending, reduced reliance on Russian oil and gas, diversified trade links and closer security cooperation with partners such as India.

Addressing the unpredictability shaping global politics, including the return of US President Donald Trump, Kallas said uncertainty has become a defining feature of the current order. “Unpredictability is clearly the word of the day,” she said. “For the European Union, predictability used to be a weakness. Now it’s becoming our strength.”

That reliability, she added, is driving deeper engagement with partners like India. “If we come to an agreement, it may take time, but when we do, we stick to it. We keep our promises,” Kallas said, calling the India–EU trade deal a clear signal of long-term commitment.