The EU's 28th Regime: Unlocking New Opportunities for India–Europe Innovation

As India and the European Union move closer to concluding a landmark Free Trade Agreement (FTA), the focus has largely been on tariffs, market access, and supply chains. Yet one of the European Union's most significant reforms for businesses lies outside the trade negotiations. The proposed 28th Regime seeks to simplify how innovative companies establish and operate across the EU by offering a voluntary, harmonised legal framework alongside national company laws.

Although designed as an internal reform, the initiative has wider implications. By making it easier for companies to expand across the Single Market, the 28th Regime could strengthen Europe's appeal as an investment destination while creating new opportunities for Indian businesses, startups, and investors seeking a long-term presence in Europe.

Simplifying Business Across the Single Market

The EU's Single Market enables the free movement of goods, services, capital, and people, but businesses still encounter different company laws, incorporation procedures, governance requirements, and administrative obligations in each Member State. For companies operating across several countries, these differences increase legal costs, delay expansion, and complicate investment decisions.

The proposed 28th Regime addresses this challenge by introducing a common legal framework that businesses may choose to adopt. Rather than replacing national legislation, it provides an optional route for companies wishing to operate across Europe with greater consistency and legal certainty. The objective is straightforward: allow businesses to spend less time navigating regulations and more time innovating, investing, and growing.

Why It Matters for India

The proposal is particularly relevant as India and the European Union deepen economic cooperation through the FTA negotiations, the Trade and Technology Council (TTC), and expanding collaboration in research, digital technologies, clean energy, and advanced manufacturing.

Indian companies are no longer viewing Europe solely as an export market. Increasingly, they are establishing research centres, technology hubs, manufacturing facilities, and regional headquarters across the continent. For many, expansion beyond a single Member State means adapting to multiple legal systems, increasing both costs and administrative complexity.

A harmonised legal framework would make Europe easier to navigate, particularly for Indian businesses seeking to scale across several EU markets. Greater legal clarity would also improve investor confidence, making Europe a more predictable destination for long-term investment.

The 28th Regime creates a business environment that supports cross-border collaboration.

Strengthening the India–Europe Innovation Partnership

Innovation has become one of the defining pillars of the India–EU relationship. Cooperation now spans artificial intelligence, semiconductors, biotechnology, digital public infrastructure, clean energy, cybersecurity, and sustainable manufacturing. Joint initiatives under the TTC and growing participation in programmes such as Horizon Europe reflect a shared commitment to building resilient innovation ecosystems.

The 28th Regime complements these efforts by creating a business environment that supports cross-border collaboration. Easier establishment procedures can encourage joint ventures, research partnerships, technology transfer, and commercialisation of new technologies, enabling innovative companies from both regions to work together more effectively.

For India's rapidly growing startup ecosystem, access to Europe's research capabilities, skilled workforce, and advanced industrial base presents significant opportunities. Likewise, European companies stand to benefit from India's expanding innovation landscape, entrepreneurial talent, and digital expertise.

Looking Beyond Tariffs

Trade agreements are often judged by their impact on tariffs, but businesses also depend on regulatory predictability. While the India–EU FTA aims to improve market access, reforms such as the 28th Regime focus on what happens after companies enter the market.

Together, these initiatives have the potential to create a more favourable environment for investment by combining easier trade with simpler business operations. This integrated approach is particularly important for sectors such as advanced manufacturing, pharmaceuticals, engineering, renewable energy, and digital services, where companies increasingly operate across multiple jurisdictions.

Enhancing Europe's Global Competitiveness

The global competition for investment and innovation is intensifying. Countries are increasingly judged not only by market size but also by the ease with which businesses can establish, finance, and expand their operations.

By reducing legal fragmentation while maintaining Europe's high standards of governance and transparency, the 28th Regime could strengthen the EU's competitiveness as a destination for entrepreneurs, venture capital, and international investment. A more coherent regulatory environment would benefit European companies while also making the region more attractive to trusted international partners such as India.

Looking Ahead

The proposed 28th Regime represents more than a technical reform of company law. It reflects the European Union's broader ambition to build a more integrated, competitive, and innovation-friendly business environment.

For India, the initiative comes at an important moment. As bilateral cooperation expands beyond trade into technology, research, sustainability, and industrial partnerships, a simpler regulatory landscape within Europe can help businesses establish stronger and more enduring connections across the continent.

While the 28th Regime alone will not redefine India–EU economic relations, it can become an important enabler of deeper collaboration. Combined with the India–EU FTA and other strategic initiatives, it has the potential to support a more dynamic partnership—one that encourages investment, accelerates innovation, and strengthens economic ties between two of the world's most influential economies.