New Delhi [India], January 26 (ANI): India and the European Union are expected to formally announce a long-awaited trade agreement at the India-EU Summit on Tuesday, and this deal is projected to significantly expand bilateral trade and drive strong growth in Indian exports over the next decade, Deloitte India partner Gulzar Didwania told ANI today.

'This deal is dubbed as the 'Mother of All Deals' because of obvious reasons. EU is India's second largest trading partner,' Didwania said, adding that 'Over the next decade, the current trade of 135 billion dollars is expected to cross 250 billion dollars.'

Didwania said the agreement could significantly scale up bilateral trade volumes over the coming years and the export gains would be substantial.

'And even in terms of India's exports, it is expected that in the next five years, India will add another 50 billion dollars due to this trade deal,' he added. The agreement is expected to provide wide-ranging market access benefits for Indian exporters.

'In 2024-25, the trade between India and EU was over 135 billion dollars. India's exports to EU was over 75 billion dollars. This deal is expected to cover 97% of tariff items where India will gain duty-free access to the European market,' he said.

Didwania said the agreement could significantly scale up bilateral trade volumes over the coming years.

He said several sectors in India are expected to benefit from the agreement. 'The sectors which are about to or expected to gain a lot of benefit from the trade deal are apparel sector where the duty of 10-12% will get slashed once the deal is into effect,' Didwania said.

He added that manufacturing exports would also receive a boost. 'Secondly, for the auto sector also, it is expected that India's exports will grow manifold,' he said. 'And thirdly, gems and jewellry sector which is also expected to add over 10 billion in terms of exports once that trade deal is in place.'

From the European Union's perspective, Didwania said the agreement would open up opportunities in the Indian market. 'Now, as far as European market is concerned, India is expected to provide duty-free access based on tariff rate quota systems to automobiles,' he said.

He also highlighted the potential gains for European exporters of industrial goods. 'India also imports lot of capital goods and machinery from EU. And therefore, it is expected that it is also going to provide a fillip to the EU export of machinery and capital goods,' Didwania said.

Didwania said the timing of the deal is important as India's trade talks with the United States remain unresolved. 'India is already discussing trade deal with United States. But the rates are not yet finalized and it is getting lingered on due to various reasons,' he said.

He added that the agreement would help both sides reduce trade concentration risks. 'This trade deal between India and EU definitely is expected to help India diversify some of their exports which they are currently doing with the US, now to the European Union,' Didwania said.

For the EU, it is expected that the dependency over countries like China and US will also reduce because India is world's fourth largest economy now and soon to become world's third largest economy, he added.

'And therefore, we are clearly hoping that this deal is going to become a very big thing in India and EU's global trade,' Didwania said.

Earlier, on Monday, Prime Minister Narendra Modi said that India was privileged to host European Council President Antonio Costa and European Commission President Ursula von der Leyen during the 77th Republic Day celebrations.

PM Modi said that the presence of the EU Delegation underscores the growing strength of the India-European Union partnership.

Meanwhile, Ursula von der Leyen called India a key global partner and said, 'A successful India makes the world more stable, prosperous and secure,' as top European leaders arrived in New Delhi to attend the 77th Republic Day celebrations and the 16th EU-India Summit, scheduled for Tuesday. (ANI)