The recently announced Free Trade Agreement (FTA) between the European Union and India is being seen as a sign of a major shift in global geopolitics. Describing it as the Mother of All Deals, a report in the British newspaper The Guardian said that this agreement has come at a time when factors like pressure on regional sovereignty, punitive tariffs and the weakness of multilateral institutions are indicating a new world order.
What is special in the agreement?
The trade agreement was jointly announced by European Commission President Ursula von der Leyen, European Council President Antonio Costa and Indian Prime Minister Modi. The agreement is expected to create a common economic framework connecting nearly two billion consumers and nearly one-fourth of global GDP.
Ravinder Kaur, Asian Studies professor at the University of Copenhagen, has written that the broad scope of the India-EU partnership reflects growing commonalities towards commitment to multilateral institutions, security and defense cooperation, research, mobility, connectivity and increased engagement in the Indo-Pacific region. According to him, as the US shrinks towards the Western Hemisphere, the Indo-Pacific region is becoming more open to new cooperation with the EU.
The shape of the post-US world is now taking shape
The report said that the ‘post-US world’ is now taking shape and this EU-India comprehensive trade agreement is part of that process. Brussels also recently signed a trade deal with the South American trade group Mercosur, while several other agreements are in the process. On the other hand, India has also signed trade agreements with the UK and New Zealand in recent months.
According to Ravinder Kaur, even if the approval and implementation of such agreements takes time or there are obstacles in between, such as the delay in the EU-MERCOSUR agreement, the change is still evident. According to him, ideas like multipolarity, strategic autonomy and reduction in dollar-dependence, which many countries outside the West have long dreamed of, are now rapidly taking shape.
India-EU FTA also inspired America to sign a trade agreement
Meanwhile, Farwa Amer, director of South Asia Initiatives at the New York-based Asia Society Policy Institute (ASPI), says the India-EU FTA may have also inspired the US to pursue a trade deal with India. According to him, India-US trade talks were already going on, but the agreement with the EU gave impetus to it. He said the coincidence of timing was notable as the agreement came directly after the EU-FTA.
