Europe, Jan 29 : The free trade agreement concluded this week between India and the European Union has stirred concern in Washington, where policymakers and analysts view it as a sign of the United States losing influence among key global partners.
Announced in New Delhi, the deal connects two major economic powers and lays the foundation for one of the world’s largest free trade zones. European Commission President Ursula von der Leyen described the agreement as a historic breakthrough, saying it would link markets representing nearly two billion people.
Political concern in the US capital
Reaction in Washington has ranged from cautious to openly critical. Senator Mark Kelly said the agreement reflects growing frustration among US allies with Washington’s trade posture.
In a post on X, the Arizona Democrat pointed to recent diplomatic moves by partners engaging beyond the United States, warning that such shifts carry long-term consequences for American economic interests.
Senior figures aligned with former president Donald Trump voiced similar unease. Treasury Secretary Scott Bessent criticised the European Union for declining to coordinate with Washington on tariff policy, arguing that Brussels had instead chosen to pursue closer economic ties with New Delhi.
Experts flag risks to US trade relevance
Trade specialists say the agreement highlights how other economies are advancing while the United States remains hesitant. The Information Technology and Innovation Foundation warned that Washington risks being marginalised as new trade rules and market access frameworks are established.
Rodrigo Balbontin, associate director at the think tank, said the pact should serve as a warning sign, even as he flagged unresolved challenges related to digital regulation and intellectual property protection. He noted, however, that reduced regulatory barriers could still deliver indirect benefits to American firms.
Calls for a measured reading
Some former officials urged caution in assessing the agreement’s immediate impact. Mark Linscott, a former US trade negotiator, said the pact deserves close attention but is unlikely to reshape global commerce overnight.
He pointed out that key issues, including agriculture, intellectual property rights and the EU’s carbon border mechanism, remain subject to future negotiations, while full implementation depends on domestic approvals across Europe.
Strategic implications
Trade talks between India and the EU began in 2007 and resumed in 2021 after a long hiatus. Together, the two account for over one-fifth of global economic output.
For Washington, analysts say the significance of the agreement lies less in short-term economic effects and more in the strategic message it sends underscoring growing pressure on the United States to rethink its trade approach as partners move ahead without it.