The European Union and India announced a major Free Trade Agreement on Tuesday. The two economies, which together account for roughly a quarter of the world’s population, spent nearly two decades negotiating the terms of the deal.
So what finally brought them together to print what the EU has hailed as the “mother of all deals”?
Statements by European leaders suggest that the self-proclaimed king of the deal, President Trump, and his rate-based trade policies over the past year likely helped push the two sides toward a final deal.
And they are not alone.
Many of the world’s major economies have rushed to create new bilateral agreements as doing business with the US has suddenly become, in many cases, more difficult, expensive and less predictable.
India and the EU have signed the “mother of all agreements”.
Indian Prime Minister Narendra Modi has described the trade agreement with the EU as “historic”, arguing that it will “deepen economic ties, create new opportunities… and strengthen cooperation” between “the world’s two largest democracies”.
Press Information Office (PIB)/Anadolu/Getty 
He said it would “facilitate access to European markets for Indian farmers and small businesses” and boost his country’s manufacturing and service sectors.
The agreement will reduce tariffs on a range of products, including textiles, apparel, leather, footwear, gems and jewellery, handicrafts, engineering goods and automobiles. India will also reduce tariffs on wine, beer and olive oil imported from the EU. The two economies will have unprecedented and preferential market access for each other’s products, their leaders said on Tuesday.
The massive European auto industry, for example, will reduce India’s current tariffs on vehicles imported from the bloc from 110% to 10%.
“We did it, we delivered the mother of all deals,” European Commission President Ursula von der Leyen said at a ceremony announcing the deal in New Delhi.
The free trade agreement, which will be formally signed later this year after approval by the European Parliament and individual member states of the bloc, will allow free trade in goods between India and the 27 EU nations.
Together, India and the EU account for 25% of world GDP and about a third of world trade, according to one. statement from the Indian government. The EU is already one of India’s largest economic partners with bilateral trade About 137,000 billion dollars in 2024-25. In comparison, during that period the bilateral trade between the US and India was around 132 billion dollars.
Separately, India and the EU also agreed on a mobility framework that will ease travel and work restrictions for skilled professionals.
UK looks to China for ‘order and organisation’ amid Trump ‘disruption’?
UK Prime Minister Keir Starmer landed in China on Tuesday, marking the first visit by a UK leader to the country since 2018.
“Over the years, our approach to China has been inconsistent – blowing hot and cold, from the Golden Age to the Ice Age. But like it or not, China matters to the UK, as one of the world’s biggest economic players, a strategic and consistent relationship with them is firmly in our national interest,” Starmer said before departing for Beijing. “That doesn’t mean turning a blind eye to the challenges they face, but engaging where we disagree. That’s what our allies do, and that’s what I will do: deliver to the public, put more money in their pockets, and keep them safe through pragmatic and consistent cooperation abroad.”
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Starmer, who traveled with a delegation of top UK business representatives including HSBC and Jaguar Land Rover, was expected to meet President Xi Jinping and Premier Li Qiang to discuss “trade, investment and national security”, according to a British government statement.
“At a time of growing global instability, where events abroad continue to haunt people at home, the Prime Minister has pledged to act in the UK’s national interest,” the government said.
Dr Yu Jie, a senior research fellow on China at Chatham House, told CBS News network partner BBC News that China also had incentives for closer ties with the UK, seeing it as an investment destination that could bring “order and organisation” amid the “disruptions” caused by President Trump’s foreign policy.
Canada and China trade agreement
Earlier this month, Canadian Prime Minister Mark Carney visited Beijing, becoming the first Canadian leader to visit China in nearly a decade.
Carney and Chinese President Xi Jinping announced a deal to reduce tariffs between the two nations on things like canola oil and electric vehicles.
Xi called the agreement a “turn” in the relationship between China and Canada, as the latter has sought to diversify its trade partnership.
Xie Huanchi/Xinhua/Getty 
Canada’s largest trading partner is the United States, but that relationship is increasingly strained by President Trump’s consistent tariff policy. It was an issue Carney mentioned during his visit, when he asked whether China was a more predictable and reliable partner for Canada than the United States.
“The only comparison I’ll give you with the U.S., our relationship … is much more varied, much deeper, much broader than with China,” Carney said. “But yes, in terms of the way our relationship with China has progressed in recent months, it is more predictable, and you can see the results coming from that.”
President Trump responded to the deal Threatening to impose 100% tariffs Regarding Canadian imports to the US, if terminated.
“If Canada makes a deal with China, it will immediately face a 100% tariff on all Canadian goods and products coming into the US,” he said in a post on the Truth Social platform.
Are Trump’s tariffs fueling a trade boom for China?
The push for bilateral deals comes as President Trump puts a lot of pressure on many of America’s longtime partners and allies, both economically and politically. Some analysts believe the pressure is benefiting one of America’s biggest rivals.
“Many countries that were not friendly to China before are now turning to China … because the United States is becoming much less predictable,” Boston College economics professor Aleksandar Tomic told Reuters. “The harder it is to deal with the US, the more it opens up to China.”
“I think China has done a good job and rightly so of positioning itself as a reliable and stable trading partner,” Derrick Irwin, head of emerging markets equity at Allspring Global Investments, told Reuters. “Basically, they said, look, you’ve got a massive trading partner in the U.S. that’s become a little more uncertain. We can provide predictability and certainty. And I think that’s very fair.”
Some experts warn that growing mistrust in the US does not necessarily mean that China is a reliable economic partner.
“Many of these countries have deep concerns about China’s approach to trade, its use of economic coercion and its unresolved maritime and historical disputes,” said Patricia Kim, a foreign policy fellow at the Washington-based Brookings Institution. “At this point, China may appear more moderate or pragmatic compared to the extreme rhetoric and actions of the Trump administration. But Beijing’s actual behavior has not been particularly reassuring.”
“Strong message”, but is the USA missing?
Mr Trump hit India with 50% tariffs last year – half of which he imposed to punish India for maintaining Russian oil imports – amid tough negotiations over a bilateral trade deal. The US and India have said they are close to finalizing the deal, but due to ongoing tensions over India’s Russian energy purchases, no date has been set.
“I think (India and the US) are actually very close behind the scenes,” Mark Linscott, a trade policy expert and senior adviser to the US-India Strategic Partnership Forum, told CBS News. “I think some compromise on both sides will lead to an agreement.”
Mr Trump has also imposed stiff tariffs on European imports, however he quickly retreated From a threat to hit the block with even higher rates amid the fight against Greenland.
European leaders were keen to point out that the free trade deal with India showed a bloc open for business, with minor jabs at Mr Trump’s policies.
Without mentioning the American leader by name, European Council President António Costa said the bilateral agreement with India “sent an important political message to the world that India and the EU believe more in trade agreements than tariffs.”
Von der Leyen called the agreement “a strong message that cooperation is the best answer to global challenges”.
In the last seven months, India has signed major trade agreements with the UK, Oman and New Zealand. The EU has also reached an agreement with South America’s Mercosur bloc, following agreements with Indonesia, Mexico and Switzerland last year.
But while Mr. Trump’s policies are pushing other countries to make deals beyond Washington, Linscott, who served as U.S. trade negotiator during Mr. Trump’s first term, said the U.S. has not been sidelined.
“If you look at the last 12 months, the country that has made the most trade agreements is the United States. There are many countries around the world that are still interested in making agreements with the United States,” he said.
He told CBS News that the flurry of recent trade deals is rooted in efforts to “diversify trade and secure supply chains” in the wake of the COVID-19 pandemic, “when it became clear how vulnerable they were.”