EU-India trade deal: a sign of shifting global trade winds?

Allianz Global Investors’ January 2026 analysis by Christian Schulz and Anand Gupta evaluates the EU–India free trade agreement as a marker of changing trade dynamics amid weakening multilateral frameworks.

• The agreement would remove or reduce tariffs on 90%+ of EU exports to India, saving an estimated €4bn annually and rivaling the scale of the EU–Mercosur deal.

• The deal reflects a turn to bilateral “Realpolitik”, as economies seek resilience by diversifying away from concentrated US–China trade dependence.

• India emerges as a strategically neutral hub, with potential long-term benefits for EM equities and debt, alongside selective support for European assets.

Explore the full paper for ratification timelines, geopolitical context and portfolio implications.