The recently concluded India–European Union Free Trade Agreement (FTA) represents a landmark in global economic diplomacy, signalling a strategic deepening of commercial linkages between two of the world’s major economic entities. After nearly two decades of negotiations, India and the European Union finalized a comprehensive trade pact in January 2026 that aims to liberalize trade in goods, services, and investment across a combined market of nearly 2 billion people, accounting for approximately 25 % of global GDP and one-third of global trade. The agreement envisages phased tariff elimination on a vast majority of traded goods—granting zero-duty access to over 99 % of Indian exports into the EU, while significantly reducing European tariffs on industrial products, automobiles, wines and spirits over a defined timeline. In addition to tariff reforms, the FTA incorporates regulatory cooperation, enhanced services market access, and frameworks for mobility of professionals and research collaboration. Positioned against a backdrop of rising protectionism and geopolitical shifts, this FTA not only promises to boost export competitiveness, diversify supply chains and augment foreign direct investment, but also serves as a strategic response to broader global trade disruptions. By balancing market access with domestic sensitivities, the India–EU FTA exemplifies a hybrid model of economic integration that may influence the architecture of future mega-regional trade agreements.