EU-India FTA Talks Pave Way for Circular Economy Collaboration

As India and the EU advance negotiations on a Free Trade Agreement, the circular economy emerges as a key pillar of cooperation. Joint initiatives aim to enhance through the sharing of expertise and the adoption of green technologies.

FREMONT, CA: The circular economy has emerged as a key area of cooperation between the European Union (EU) and India, particularly as negotiations for a Free Trade Agreement (FTA) gain momentum. Speaking at the Confederation of Indian Industry (CII) Business Summit, Ewa Suwara, Deputy Head of the Delegation of the European Union to India, underlined the role of the circular economy in enhancing EU-India business ties and driving sustainable development. With both sides engaged in ongoing FTA negotiations and strengthening bilateral relations, integrating circular economy principles into the trade framework could unlock new economic opportunities and deepen strategic collaboration.

India and the EU resumed comprehensive free trade agreement (FTA) talks in June 2022, following an eight-year hiatus. Alongside the trade agreement, negotiations also cover an investment protection agreement and a pact on geographical indications. Key discussion areas include agriculture and dairy, labour standards, sustainable development, government procurement, and investment-related matters. The inclusion of the circular economy in these discussions reflects a broader shift towards sustainable trade and economic practices.

In 2025, the context for EU-India collaboration is rapidly evolving. Recent high-level visits by EU officials, joint research initiatives, and policy dialogues have laid the groundwork for deeper cooperation in sectors related to sustainability and the green transition. As highlighted by Suwara, the circular economy presents a significant “circular value” that can enhance bilateral ties and support a shared vision for resource efficiency, innovation, and job creation.

India’s growing focus on a circular economy aligns with the global Sustainable Development Goals. It aims to minimise waste, maximise resource efficiency, and promote regenerative economic practices. The circular economy in India is projected to reach a value of $2 trillion and generate 10 million jobs by 2050, a potential that makes the sector a critical area for collaboration with the EU. The EU, with its long-standing commitment to circular practices under its Green Deal and industrial strategy, is well-positioned to support India in realising these economic benefits.

One of the key initiatives driving this collaboration is the EU-India Resource Efficiency and Circular Economy Initiative (EU-I RECEI). This programme, specifically designed to foster sustainable value chains and create economic opportunities, particularly for micro, small and medium enterprises (MSMEs) and entrepreneurs, is a significant driver of the circular economy in India. By leveraging European expertise and best practices, the initiative supports India in transitioning towards circularity while aligning with international standards on sustainable consumption and production (SCP). It also contributes to India’s efforts in mainstreaming circular practices across various industries.

Another milestone in the bilateral partnership came in February, when the India-EU Trade and Technology Council (TTC) launched two primary research and innovation programmes, with a joint investment of ₹391 crore (€41 million). These initiatives focus on addressing marine plastic pollution and advancing waste-to-green hydrogen technologies. Coordinated under the EU’s Horizon Europe programme, with co-funding from India’s Ministry of Earth Sciences and Ministry of New and Renewable Energy, these projects aim to bring together Indian and European researchers, start-ups, and industrial stakeholders to co-develop sustainable solutions. The collaboration demonstrates how science and technology can serve as a bridge for environmental innovation and collaborative problem-solving.

These developments underscore the strategic importance of embedding sustainability and circular economy principles into trade and investment frameworks. By including the circular economy in the FTA dialogue, the EU and India can build a robust mechanism for mutual growth that is not only economically beneficial but also environmentally sound. For businesses, particularly in the manufacturing, logistics, and renewable sectors, this could mean access to new markets, technology transfers, and increased competitiveness driven by sustainable innovation, inspiring a new era of economic growth and environmental responsibility.

As India and the EU push forward with FTA negotiations, the integration of the circular economy into the bilateral agenda represents a powerful convergence of economic, environmental, and geopolitical interests. It signals a shift towards a more responsible form of globalisation, where sustainable trade and innovation foster inclusive growth and long-term resilience.