Washington is buzzing with unease as the landmark free trade agreement between India and the European Union takes center stage in global commerce. Covering a staggering 25% of world GDP and 33% of international trade, this pact unites two economic powerhouses and leaves the United States pondering its next move.
India’s trade with the EU stands at $25 billion annually, dwarfed by the $45 billion exchanged with America. Yet, influential US senators, top officials, and policy experts are raising alarms. They warn that the India-EU Free Trade Agreement (FTA) could sideline Washington in reshaping global trade and strategic alliances.
Senator Mark Kelly, a Democrat from Arizona, captured the sentiment on X, pointing fingers at former President Donald Trump’s policies. ‘The EU has struck a trade and security deal with India. Canada and the UK are negotiating with China. This is happening because Trump alienated our allies,’ he posted. Kelly emphasized that such moves by partners would boomerang on the US.
Announced this week in New Delhi, leaders hailed it as India’s biggest trade breakthrough ever. European Commission President Ursula von der Leyen called it the mother of all agreements, forging a free trade zone for 2 billion people amid rising global trade tensions and geopolitical flux.
Trump administration veterans expressed frustration. Treasury Secretary Scott Bessent criticized the EU on CNBC for not aligning on tariffs, calling their stance disappointing. ‘They should do what’s best for them, but the Europeans have been very disappointing,’ he said, noting their reluctance to join high-tariff efforts against others.
Policy think tanks in Washington see this as a wake-up call. The Information Technology and Innovation Foundation (ITIF) highlights how other economies are surging ahead while the US lags. Associate Director Rodrigo Balbontin urged lessons from the deal, critiquing Europe’s digital rules for discriminating against multinationals and India’s IP challenges, yet spotting potential indirect US gains if barriers ease.
ITIF welcomes closer India-EU ties in a protectionist world, stressing China’s trade practices as the century’s biggest threat. Former US trade official Mark Linscott, writing for the Atlantic Council, tempers hype: no seismic shifts expected, with benefits unfolding gradually via phased tariff cuts. Sensitive issues like agriculture and IP are deferred.
Ratification hurdles remain, needing EU member states and parliament approval. From Washington’s view, Linscott argues it won’t harm US ties and might even boost momentum for an America-India deal. Talks, stalled since 2007 and revived in 2021, signal that as free trade partners advance, America must rethink its playbook to stay relevant.