India and the European Union have agreed to finalise a long-pending free trade agreement this year and boost cooperation in trade, technology, connectivity and defence, Indian Prime Minister Narendra Modi and the European Commission chief said.

Its their first commitment to a deadline on talks that have been going for years, as they look to soften the effect of tariff increases from the US.

India and the European Union will try to seal a trade deal during this year, European Commission President Ursula von der Leyen said on Friday.