Washington has signalled growing unease over the European Union’s decision to move towards finalising a sweeping trade agreement with India, even as negotiations between India and the United States remain unresolved. The remarks, delivered by US Treasury Secretary Scott Bessent in a televised interview, underscore rising transatlantic tensions over trade strategy and influence in one of the world’s fastest-growing major economies.Bessent criticised the EU for pressing ahead with a comprehensive pact with India while talks between New Delhi and Washington on a separate trade framework are still under discussion. He suggested that the timing risked undercutting parallel efforts by the United States to rebalance trade relations with India and address long-standing concerns on tariffs, market access and regulatory barriers. The comments come as India and the EU prepare to unveil what officials on both sides have described as a landmark agreement that could reshape trade flows across sectors ranging from manufacturing and pharmaceuticals to digital services and green technology.
Negotiators in Brussels and New Delhi have spent years attempting to bridge gaps over labour standards, environmental rules, data protection and tariff schedules. Momentum accelerated over the past year amid shared concerns about supply-chain resilience, geopolitical fragmentation and over-reliance on a narrow set of manufacturing hubs. The anticipated deal is expected to lower or eliminate duties on a wide array of goods, expand access for services providers and set common standards in areas such as intellectual property and sustainability.
For India, the agreement promises a significant boost for exports to the EU, its largest trading partner. Sectors such as textiles, auto components, chemicals, engineering goods and information technology services stand to gain from reduced tariffs and clearer regulatory pathways. Policymakers in New Delhi view the pact as a strategic anchor that could lock in long-term access to a high-value market while reinforcing India’s position as an alternative manufacturing and services hub for European firms.
The United States, however, has pursued a more cautious and selective approach to trade engagements, favouring sector-specific arrangements and strategic frameworks over broad free-trade agreements. Talks with India have focused on resolving disputes over digital taxation, agricultural market access, tariffs on industrial goods and standards affecting technology and data flows. Progress has been uneven, with both sides signalling political sensitivity around domestic industries and employment.
Bessent’s remarks reflect concerns in Washington that the EU–India agreement could tilt competitive conditions against US exporters and investors if European firms secure preferential access ahead of American counterparts. US officials have also argued that parallel negotiations require coordination among allies to avoid fragmenting standards and weakening collective leverage on issues such as subsidies, state-owned enterprises and environmental compliance.
European officials have defended their approach, emphasising that the agreement with India is not directed against any third country and is consistent with rules-based trade. They argue that diversifying economic partnerships has become essential as global trade patterns shift and geopolitical risks intensify. From Brussels’ perspective, India’s large domestic market, young workforce and expanding manufacturing base make it a natural partner at a time when Europe is reassessing dependencies and seeking resilient supply chains.
India has sought to balance these competing interests by deepening ties with both the EU and the United States, while maintaining strategic autonomy. Officials involved in the negotiations have indicated that the EU deal is designed to complement, not replace, engagement with Washington. They point to parallel initiatives on technology cooperation, defence production and clean energy with the United States as evidence of a multi-track strategy.
Trade experts note that the divergence in approaches highlights broader differences between the EU and the United States on how to engage emerging economies. While Brussels has leaned towards comprehensive agreements that embed regulatory and sustainability commitments, Washington has prioritised flexibility and domestic policy space. The result has been a patchwork of arrangements that can create friction among allies competing for influence and market share.