00:00It's been described then as the mother of all deals, the leaders of India.
00:05And the European Union signing in the last hour or so, a huge trade pact reached.
00:10After two decades of negotiations, the deal announced then as EU...
00:15The leaders have headed there to rubber stamp it, if you like, they aim to help S.H.I.E.L.D. against challenges.
00:20From the world's two leading economies, the United States and China.
00:25Just before that signing, in fact, Narendra Modi, the Indian Prime Minister, spoke.
00:30Let's hear what he had to say.
00:32India and the European Union.
00:35The European Union have signed a huge trade agreement.
00:40People around the world are calling it the mother of all deals.
00:45People around the world are calling it the mother of all deals.
00:50This agreement brings huge opportunities for India's 1.4 billion people and...
00:55for millions of people across European countries.
01:00Well, our business editor.
01:02Shal Pellegrant is joining me here on sax.
01:04Shal, just in thevivenesson...
01:05Sum up for us exactly what this deal consists of can you so it's a broad agreement to lower
01:10tariffs on most consumer and industrial goods and for both sides.
01:15It's significant when you consider that India is known to be quite a protectionist economy
01:19famously described.
01:20As the tariff king by Donald Trump, the EU Commission's
01:25says the agreement will end up reducing or eliminating entirely tariffs on over
01:3096% of EU goods exports to India, something that says no other
01:35trading partner has ever received.
01:37Let's take some product examples.
01:40Import duties on EU cars currently stand at 110%.
01:45Well, they would gradually move down to 10% in terms of EU agricultural exports.
01:50There are opportunities for EU farmers as well.
01:53Indian tariffs in that sector hover over
01:5536% on average.
01:57Well, wine duties would be cut from 150% to...
02:0075% and eventually down to 20%, olive oil tariffs would go down to 0%.
02:0575% from 45% after five years.
02:08EU exporters stand to save around...
02:101 billion euros in tariffs per year with this deal.
02:13We're talking about the world's second...
02:15and the world's fifth largest economies coming together here, aren't we?
02:18The scale of these two...
02:20markets is really huge.
02:22India is the world's most populous country, obviously.
02:25And on top of that, it's a very fast-growing economy.
02:28Its GDP is over...
02:303.4 trillion dollars.
02:31And it's estimated to have increased by 7.4% in 2020.
02:3525% up from 6.5% in 2024.
02:38And except during...
02:40COVID, will growth levels have been consistently high over the past eight years or so as you...
02:45can see there.
02:46The country is currently the EU's ninth biggest trade partner.
02:49So there is...
02:50a lot of room to grow there and goods trade has already increased 90%.
02:55in the last decade, lowering tariffs means EU businesses could further benefit from...
03:00that growth in economic activity.
03:02And what about India?
03:03What does it stand to get out of this?
03:05It's a similar story for India.
03:08They could see their exports to the EU.
03:10boosted by as much as 50 billion euros by 2031.
03:13That's according to one study with...
03:15pharmaceuticals, textiles, and chemicals likely to benefit the most.
03:18All sectors which employ a...
03:20huge number of people in the country.
03:21The deal says that over seven years, Indian...
03:25goods will eventually face tariffs of 0% from the EU except for...
03:30obviously key sectors such as autos, steel, and agriculture.
03:3492%
03:35of India's exports or tariff lines to the EU will see reduced or eliminated...
03:40tariffs.
03:41This comes at a crucial time.
03:42India's exports have been hit hard by Trump.
03:45India's tariffs imposed because of New Delhi's own tariffs and its purchases of...
03:50Russian oil, reaching a rate of 50%.
03:52So Modi's been on a quest to diversify...
03:55his trade portfolio and protect India from such punitive tariffs...
04:00tariffs from the US.
04:01Since May last year, four deals have been struck, including the one with the EU agreements...
04:05that have been reached with the UK, Oman, and New Zealand...
04:08and discussions are in the works with other...
04:10other blocs, including Mercosur in Latin America, Chile, Peru, and the Gulf Cooperation...
04:15and that diversification is what the EU's been doing as well.
04:19We saw it with the deal...
04:20struck with the Mercosur bloc earlier this month.
04:22It's also about more than just trade.
04:24It's about the...
04:25what kind of world these two powers say they want to live and work in...
04:30one that's still governed by the free trade ideals which Donald Trump has sought to dismantle.
04:35Ursula von der Leyen underlined it when she said,
04:38we've sent a signal to the world...
04:40that rules-based cooperation still delivers great outcomes.
04:44Sean, thanks very much, Sean.
04:45Pellegrine analyzing that deal for us from the business perspective, of course.
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