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The EU’s new strategic agenda with India signals Brussels’ intent to transform a traditional donor-recipient dynamic into an equitable partnership that advances trade, technology, and sustainable development across the Global South.
As the European Union (EU) unveiled the ‘New Strategic EU-India Agenda’ by adopting a Joint Communication by the European Commission and the High Representative for Foreign Affairs and Security Policy, there is a clear message from Brussels. It is keen to deepen cooperation with New Delhi on trade, technology, and defence.. Consisting of five pillars—Prosperity and Sustainability focussing on trade, investment and economic security; Technology and Innovation to establish resilient digital societies and research cooperation; Security and Defence to deepen regional collaboration on defence and industrial aspects; Connectivity and Global Issues promoting cooperation in third countries to bolster connectivity and shape global governance; Enablers Across Pillars aiming at labour and skills mobility for broader engagement—Brussels is keen to carve new strategic opportunities for partnering with New Delhi.
Launching the strategy on Indian Prime Minister Narendra Modi’s birthday, European Commission President Ursula von der Leyen underscored the emergence of India as a pivotal partner in times of regional and global upheaval, including the conflict in Ukraine. As the Roadmap to 2025, launched during the 15th EU-India summit in 2020, was up for renewal, the EU began closely monitoring its geostrategic endeavours, especially amid the high tariffs imposed by US President Donald Trump’s administration on almost every country in the world.
India’s careful appraisal of the ongoing free trade negotiations with the United States certainly holds long-term strategic implications for the EU-India partnership. If India can successfully negotiate the 50 percent tariff with Trump, the EU can take a breather, as it is under pressure from the US to admonish India for its Russian oil imports. Further, the raging US-China war on procuring rare earths will have far-reaching consequences for the manufacturing sector, particularly for the renewable energy, military hardware, smartphones, and automobile industries.
This makes it imperative for India and the EU to join hands to ensure ‘mutually beneficial and transformative outcomes’ for both the actors as well as for the global community. As pluralistic democracies sharing mutual interests and common values, alignment of efforts between the EU and India is crucial for hedging trade tensions. As India’s Russian oil imports continue to be a bone of contention for the West, the sensitivities around the war in Ukraine have forced Europe to diversify its partnerships and, in turn, look towards the Global South for support. This also implies doubling down on the India-EU Free Trade Agreement (FTA) that can open up new avenues for trade, jobs, and investments. As per the Federation of European Business in India’s (FEBI) Business Sentiment Survey 2025, around 6000 European companies operate in India presently, generating about 8 million jobs, underscoring confidence in India’s economic outlook. Yet, bottlenecks in the form of the Carbon Border Adjustment Mechanism (CBAM), EU Deforestation Regulation (EUDR) and regulatory barriers of high taxes, customs procedures, and Quality Control Orders (QCO) persist.
As pluralistic democracies sharing mutual interests and common values, alignment of efforts between the EU and India is crucial for hedging trade tensions.
This reflects the need for the EU and India to move beyond the rhetoric by channelising concrete actions for shared outcomes. Collaboration in sectors such as the green transition, trade, transfer of digital technologies, infrastructural connectivity, health, and climate resilience should be prioritised by the two.
As one of the world’s largest development aid providers, the EU’s official development assistance (ODA) continues to occupy a significant position in the global aid landscape. For instance, in 2023, the EU’s collective ODA stood at EUR 95.9 billion, representing 42 percent of total global ODA contributions.
The Trump administration’s decision to gut the United States Agency for International Development (USAID) will likely impact the EU’s development aid policy and the larger global aid architecture. Naturally, the EU cannot completely offset these changes and may be unable to fully fill the resulting vacuum. What Brussels can do, however, is strategically expand its influence to gain strategic depth in critical sectors such as trade, technology, and capacity building.
Here, the EU-India Trade and Technology Council (TTC) offers equal promise, especially after a Memorandum of Understanding (MoU) on semiconductors was signed in 2023. Expanding supply chains for green and digital transitions, encouraging innovations in research ecosystems, and enhancing mutual economic competitiveness are some of its key highlights. However, differences in governance frameworks on digital privacy and data protection, disparities across regulatory and structural aspects of tech capabilities, and trade policy restrictions—which could be addressed by signing the FTA—remain significant hurdles impacting the TTC’s implementation.
Nonetheless, the new strategic agenda underlines the importance of ‘amplifying the impact of investments’ in third countries by merging India’s increasing role as a development partner with the EU’s Global Gateway initiative. India’s prominent rise as a reliable development partner from the Global South is noteworthy. Its development interventions in several parts of Africa and Asia continue to facilitate disaster-risk preparedness against climate shocks and natural hazards through initiatives such as the International Solar Alliance (ISA) and the Coalition for Disaster-Resilient Infrastructure (CDRI). Organically inclined towards the sustainability narrative, India’s interventions through Lines of Credit (LoC), grants, and especially the Indian Technical and Economic Cooperation (ITEC) programme have been instrumental in supporting skill transfer and capacity-building of numerous developing countries.
Furthering the EU-India joint development partnership in third countries can facilitate both an economic and strategic presence for the partners. The emergence of connectivity as a linchpin of the present-day international order is a critical factor. Easing trade flows and diversifying supply chains to enable the exchange of resources, goods, services, as well as human capital has become increasingly imperative. With the strategic connectivity investments offered by China’s Belt and Road Initiative (BRI), several countries, including those in the EU, are resorting to nearshoring to ensure business continuity and stable supply chains.
From the Global South perspective, it is imperative for the EU to move beyond its traditional donor role and enable locally led development in key sectoral areas such as climate adaptation, energy transition, health systems, and sustainable infrastructure.
With India’s GDP surge driving its growth story, countries are perceptibly looking at New Delhi as a popular nearshoring destination. Clearly, this also contributes to bolstering connectivity—a joint target shared by both the EU and India. In this context, the India-Middle East-Europe Economic Corridor (IMEC), launched during India’s G20 Presidency in 2023, reinforces the EU’s Global Gateway strategy. By attempting to strengthen trade, energy cooperation, and digital governance across the Indo-Pacific, IMEC is designed to create shared economic and geopolitical benefits for India, the EU, and the partner countries involved.
From the Global South perspective, it is imperative for the EU to move beyond its traditional donor role and enable locally led development in key sectoral areas such as climate adaptation, energy transition, health systems, and sustainable infrastructure. Countering internal fragmentation, aligning differing priorities, and leveraging collective impact are fundamental for the EU. By co-creating projects with India as a partner, the EU can help mobilise catalytic development finance for the Global South in areas such as digital governance, climate-resilient infrastructure, food security, health, and energy transition.
As the formalities progress, the new strategic agenda requires endorsement by the European Parliament and the Council before formal negotiations commence at the India–EU Summit in January 2026. Yet, this agenda marks an optimistic milestone for the strategic partnership between Brussels and New Delhi in times of geopolitical turmoil.
Swati Prabhu is a Fellow with the Centre for New Economic Diplomacy (CNED) at the Observer Research Foundation.
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Dr Swati Prabhu is a Fellow with the Centre for New Economic Diplomacy at the Observer Research Foundation. Her research explores the idea of aid, evolving ...
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