German Chancellor Friedrich Merz, on his first visit to India, urged an urgent finalization of the EU-India freetrade agreement (FTA) during a meeting with Prime Minister Narendra Modi, according to a joint press release. India and Germany have signed agreements and made announcements covering defence, green hydrogen, skills mobility, and supply chains.

Key takeaways: Berlin is committing EUR 1.24 bn under its Green and Sustainable Development Partnership to green hydrogen and climate infrastructure — sectors where German tech is increasingly seeking a landing spot in both India and the Gulf. In addition, the country backed co-development in the defence sector, no-visa transit for Indian passport holders, and expanded healthcare worker mobility. The two sides are also seeking to expand cooperation in semiconductors and critical minerals.

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Why this matters: Germany, India’s largest trade partner in the EU, is emerging as a key source for defence acquisitions as New Delhi weans off Russian equipment. New Delhi is negotiating an agreement to buy six conventional submarines from Germany for USD 8 bn. Furthermore, the forthcoming FTA is expected to streamline logistics and capital flow, positioning the India-Middle East-Europe Economic Corridor (IMEC) as a potential dominant architecture in global trade for the next decade.

The EU-India FTA signing is slated for 27 January, coinciding with visits to India by European Commission President Ursula von der Leyen and European Council President Antonio Costa.

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