In a strategic move following the finalisation of the India-European Union Free Trade Agreement (FTA), Union Finance Minister Nirmala Sitharaman met Christine Lagarde, President of the European Central Bank, in Munich, Germany, to explore deeper financial cooperation and the ECB’s potential role in facilitating trade flows under the agreement.
The Finance Ministry said on X that both leaders expressed satisfaction over the conclusion of the India-EU FTA, scheduled to take effect from January 2026. During the meeting, Sitharaman underlined the importance of financial sector support in ensuring smooth trade and investment flows as the agreement moves towards implementation.
According to the ministry, both sides welcomed the landmark trade pact, with the Finance Minister highlighting the ECB’s potential contribution in strengthening financial mechanisms to promote bilateral commerce.
In a key announcement, Sitharaman said India would permit European Union banks to open up to 15 branches in the country over the next four years under the FTA framework. The initiative will be facilitated through provisions in the Union Budgets for FY 2025-26 and FY 2026-27.
The India-EU FTA, finalised after prolonged negotiations, is expected to significantly boost bilateral trade by reducing tariff and non-tariff barriers and encouraging greater investment flows between India and the 27-nation European bloc. Financial cooperation is seen as critical for enabling efficient payment systems, regulatory coordination, and expanded banking access to support growing trade volumes.
The Munich meeting reflects India’s broader push to deepen its strategic and economic partnership with the European Union, with the FTA emerging as a cornerstone of its global trade strategy.