EU-India Free Trade Agreement signals mixed economic impacts across sectors. EY's latest report indicates the recently announced FTA could boost India's competitiveness while creating pressure on some European industries. The minerals sector may benefit from improved access to production inputs, though the clothing industry faces stronger competition from Indian producers. Meanwhile, Europe's economic outlook remains fragile amid global trade tensions and geopolitical risks. US tariffs are expected to reduce EU GDP growth by 0.5 percentage points in 2026, with the most severe effects in Ireland and Nordic countries. Despite these headwinds, the euro area economy is projected to grow at 1.3 percent in 2026, gradually recovering to 1.5 percent by 2028-29. Geopolitical uncertainties continue to shape trade flows and sectoral competitiveness across Europe and India.
