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India and the European Union (EU) are moving closer to finalising a free trade agreement within the next three months, according to reports, cited by IANS. Negotiations have accelerated in recent weeks, covering key areas such as agriculture, sustainability and market access. Officials familiar with the discussions said the two sides are keen to close gaps that have stalled progress for years. The talks have gained momentum as global trade faces uncertainty triggered by the United States' tariff offensive. The push to conclude the deal reflects both sides’ effort to secure economic stability and strengthen supply chains amid shifting geopolitical alignments.

The EU views the proposed deal as a shield against global market volatility, while India sees it as a strategic step towards asserting its position in global trade. The agreement, if sealed, could reshape the contours of India-EU economic engagement, creating new opportunities for businesses on both sides.

"For Europe, this is a matter of securing market resilience," an official said. "For India, it represents confidence and a readiness to lead in shaping global trade rules," IANS reported. India's growing manufacturing base, digital innovation, and expanding consumer market have made it an attractive alternative for European firms seeking to reduce dependence on China. Europe's push to diversify away from Russia and China has further underscored India’s importance as a long-term trade and investment partner.

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One of the key sticking points in the negotiations remains the European Union's proposed sustainability clauses, including the Carbon Border Adjustment Mechanism (CBAM). Commerce and Industry Minister Piyush Goyal has termed such measures "unfair", arguing that they disproportionately burden developing economies for emissions they did not historically cause.

India has urged the EU to adopt a balanced approach that recognises developmental needs and shared responsibilities. European negotiators, however, continue to stress the need for binding commitments on climate and sustainability as part of their wider Green Deal agenda.

While progress has been made, several issues remain unresolved, including tariff schedules and market access for sensitive sectors such as agriculture and dairy. Both sides are working through these challenges in an attempt to find common ground before the target deadline.

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