Amidst Trump tariffs and a stalled Mercosur, the EU and India line up a free trade agreement

A free trade agreement offers the prospect of improved access for Irish businesses, deepening co-operation in research and emerging technologies, and could double trade between India and the EU

A statue of Mahatma Gandhi beside the Vidhana Soudha parliament building in Bangaluru, India, the seat of the Karnataka Legislative Assembly. Picture: Paul McCarthy

Amid Trump tariffs and a stalled Mercosur, the EU and India line up a free trade deal

Would you like a selfie with Narendra Modi?

The prime minister of the world’s biggest democracy would be difficult to get close to, you may think, but technology has the answer.

The Pradhanmantri Sangrahalaya, or prime minister’s museum, is housed at the former home of India’s first prime minister, Jawaharlal Nehru. A newer section of the exhibition invites visitors to take a selfie with your favourite prime minister — including Modi, Nehru, or Indira Gandhi — using augmented reality. You can also use an AI holobox to chat with Vallabhbhai Patel, who served as deputy prime minister during the first three years of Indian independence.

The past and the future are often on display in India, from the world-famous Taj Mahal in Agra and the colonial Bangalore Palace, to the Centre for Cellular and Molecular Platforms in the southern city — with its mandate of enabling cutting-edge life science research and innovation.

Indian Prime Minister Narendra Modi wants to fast-track development in the nation of 1.4 billion people.

India’s economy is modernising quickly — GDP growth of 7.4% is predicted for 2026, up from 6.5% last year.

The government wants to fast-track development in the nation of 1.4bn people. The Viksit Bharat 2047 plan is India’s vision to become a developed nation by the 100th anniversary of its independence in 2047.

The country is already projected to become the world’s third-largest economy by 2030, with an estimated GDP of €6.2 trillion. It currently is the fifth-largest, with annual GDP of more than €3.5tn.

In February, it will host the India AI Impact Summit from February 15-20. In December, tech giants Amazon and Microsoft announced a combined $52.5bn (€44.8bn) investment plan for India over the coming years. Abhay Karandikar, secretary of India’s Department of Science and Technology, said recently that “AI-powered platforms such as Hashim, IndiAI, and Smart Solutions are positioning India as a global leader on the world map of artificial intelligence”.

Against this backdrop, the likelihood of a free trade agreement between India and the EU being signed this month offers the possibility of opening up greater access for Irish businesses to the country.

For the EU, signing a deal with India would follow on the heels of the Mercosur agreement, a move that has attracted criticism, particularly from farming groups.

It would mark another step in the EU creating its own trade networks as the US shakes up global trade, and would help to reduce
reliance on China.

Paul McCarthy has a 'selfie' with India’s first prime minister Jawaharlal Nehru at the Pradhanmantri Sangrahalaya, or prime minister’s museum, which is housed at Nehru's former home in New Delhi.

German chancellor Friedrich Merz floated the possibility that the EU and India could sign a deal as early as the end of this month, after he met Mr Modi on Monday.

The president of the European Council, António Costa, and the president of the European Commission, Ursula von der Leyen, will travel to India to represent the EU in the 16th EU-India Summit, scheduled to take place on January 27, and are the chief guests at the Republic Day event in Delhi the previous day.

India is also in negotiations with the US on a trade deal. However, Donald Trump’s administration doubled import tariffs on Indian goods to 50% last year as punishment for its heavy buying of Russian oil.

Last week, Colm Brophy, the minister of state for migration, visited India. Under a renewed action plan for enhanced engagement with India unveiled last year, and the Asia Pacific strategy, the Irish Government says it is committed to deepening the strategic relationship with India across all strands of cooperation. The strategy finds there is untapped potential in the relationship which is ready to be realised.

Mr Brophy’s visit took place against the backdrop of strong and growing economic ties between Ireland and India. Two-way trade has expanded significantly over the past decade, with combined trade now standing at just over €16bn, an increase of around €12.5bn.

An estimated 80,000 Indian nationals are currently living in Ireland. Ireland hosts the second-largest population of Indian students in the EU, after Germany, with approximately 10,000 Indian students currently resident in the State, comprising 18% of Ireland’s international student population. Indian nationals accounted for around one third of all employment permits issued in 2024, with similar figures emerging for 2025. The New Delhi visa office is Ireland’s largest visa operation outside the State.

Last September, then foreign affairs and trade minister Simon Harris launched an Ireland-India economic advisory panel.

Speaking at the launch, Mr Harris said: “Ireland and India have extremely strong historical links, and there is no doubting the strength of the economic, cultural, and people-to-people links which bind us.

“We each have drawn inspiration from the other throughout our often difficult histories, and this represents a bond whose value or significance cannot be disputed.

“The scope for more economic links and trade between our two countries is enormous, and I am determined that we make every opportunity to avail of these.”

At EU level, Ireland has welcomed renewed engagement with India, including the development of a new EU-India strategic agenda and the planned EU-India Summit scheduled for the end of this month.

The Department of Justice said in a statement: “Ireland also continues to support the conclusion of a balanced and mutually beneficial EU-India Free Trade Agreement, which is strategically important in supporting market diversification and improved access for Irish and European businesses, including in the food and drink sector, and in providing a framework for deeper co-operation in research and emerging technologies.

“If an FTA [Free Trade Agreement] can be concluded, it has the potential to double trade between India and the EU, and it is strongly hoped that it can be signed at the EU-India Summit in January 2026.”

If the deal is done, then perhaps Micheál Martin will enjoy having his picture taken with the actual Mr Modi, rather than his virtual image.