The Mother of All Deals – and the Father of All Failures: Europe’s Late Yes to India
The signing of the free trade agreement between the European Union and India is being celebrated today as a historic breakthrough. Yet the late timing of this deal is no coincidence; it is the result of a long chain of political, strategic, and economic misjudgments—above all on the European side. Only after nearly twenty years of intermittent and faltering negotiations was an agreement concluded that, given India’s economic importance, could and should have become reality much earlier.
Phase 1: Strategic Misjudgment of India (approx. 2005–2012)
At the outset of the negotiations, the European Union systematically underestimated India’s long-term economic and geopolitical significance. While the EU focused its trade policy priorities heavily on the United States and especially on China, India was often viewed as a difficult, bureaucratic, and slow-reforming partner.
A key mistake was the attempt to enforce European standards—such as those related to environmental protection, labor law, intellectual property, and market access—in an almost uncompromising manner, without sufficient regard for India’s level of development and its domestic political constraints. This normative rigidity led early on to a loss of trust and hardened negotiating positions.
Phase 2: European Fragmentation and Loss of Priorities (2012–2019)
In the years that followed, the EU’s structural weaknesses became increasingly apparent. Internal disagreements among member states, shifting political majorities, and slow decision-making processes repeatedly caused negotiations to stall or be suspended altogether.
At the same time, the EU was largely preoccupied with its own crises: the eurozone crisis, the refugee crisis, Brexit, and the rise of populism consumed political and administrative resources. India slipped further to the margins of European trade policy—another strategic error. Meanwhile, India deliberately expanded its relationships with other partners and reduced its dependence on Europe.
Phase 3: Reactive Instead of Proactive Action (2019–2023)
One of the EU’s most serious mistakes was its reactive approach. Only when geopolitical tensions with the United States intensified, supply chains became more fragile, and China was increasingly perceived as a systemic rival did Europe begin to rediscover India as a strategic partner.
The deal now being celebrated is therefore less the result of long-term strategic planning than a belated correction of earlier failures. The EU acted not out of strength, but out of necessity—a circumstance that weakened its negotiating position and cost valuable time.
Potential Mistakes in Implementing the Agreement
Even after its signing, the agreement carries significant risks. Both the EU and India could substantially undermine the deal’s impact through poor implementation choices.
Potential mistakes by the EU:
- Excessive bureaucracy and slow implementation of agreed market openings.
- Continued moral lecturing of India on sensitive political issues, potentially straining economic cooperation.
- Insufficient support for small and medium-sized enterprises in taking advantage of new trade opportunities.
- Internal blockages by individual member states during practical implementation.
Potential mistakes by India:
- Delayed or selective reduction of tariffs and non-tariff trade barriers.
- Unclear or unstable regulatory frameworks that deter investors.
- Preferential treatment of domestic companies despite formal market liberalization.
- Political interference in economic processes.
Conclusion: A Historic Deal with Belated Insight
The free trade agreement between the EU and India is undoubtedly a milestone. At the same time, it serves as a case study in strategic short-sightedness, political inertia, and missed opportunities—particularly on the European side. The true success of this deal will not be measured by its symbolic significance, but by whether both partners learn from past mistakes and implement the agreement in a pragmatic, reliable, and genuinely cooperative manner.
