Estonia, a member of NATO’s frontline bordering Russia, is optimistic of early conclusion of a Free Trade Agreement (FTA) between India and the EU. The Baltic nation also wants to further enhance its bilateral ties with India through cooperation in the digital space (Estonia is the most digitised country in the world), defence, agriculture, trade and education. It is also a pioneer among the nations offering e-residency, which many Indians are opting for.
“We are the most digitised country in the world and would like to extend our support to India – especially in the start-up sector,” Margus Tsahkna, minister for foreign affairs, Estonia, told Business India. “Our President Alar Karis will be visiting India in February 2026 for the AI Summit. We would also like more Indians to take up e-residency in Estonia, which will enable them to work remotely for any businesses across the EU.” About 3,000 Indians have taken up e-residency in Estonia until now.
India-EU FTA is in its final stages of negotiations and is likely to be finalised soon. “We are also optimistic of the early conclusion of India-EU FTA,” Tsahkna added. “But one of the roadblocks is India’s association with Russia – especially the defence partnership.”
“Estonians are the frontliners, as we have a border with Russia,” Tsahkna affirmed. “If the peace plan does not succeed, then the aggression will continue. Ukraine is under heavy pressure on territories, and we hope that peace is just and lasting. We have lots of bilateral opportunities with India, as it’s a strong economy; so, many countries across EU want to have bilateral ties with them.”
“Bilateral trade between India and Estonia is increasing,” Ashish Sinha, India’s ambassador to Estonia, told Business India. “It’s close to $170 million at present. We also hope to strengthen defence co-operation, for which an MoU is under discussion. We are working on a partnership in agriculture.” Nearly 2,000 Indians live in Estonia now – mostly employed in the IT sector, Sinha added.
Meanwhile, many Indian students are considering Estonia for undergraduate degree programmes and for research, too. At present, there are close to 200 Indian research scholars in Tartu, Estonia. It is their earnest hope that more Indian airlines would consider using their MRO (maintenance, repair, overhaul) facility in Tallinn. In the past, IndiGo had its maintenance done here, and Estonia hopes that Air India would consider the offer too.
Both India and Estonia are also exploring co-operation in the defence sector. There is also a likelihood of co-production of military equipment for which an agreement is likely to be signed, which will enable joint research and development and an industrial partnership.
Countering Russian challenges
Estonia is increasing its defence spending from the present 2 per cent of its GDP to 5 per cent next year – primarily to counter the challenges from its neighbour, Russia. It is investing a lot in drones, too. The country is also seeking India’s support to sort out its differences with Russia.
“India is a democracy, and we hope it will respect a rule-based world order,” Kaimo Kuusk, permanent secretary, Ministry for Defence, Estonia, told Business India. “We don’t trust Russia and have a low diplomatic presence with them.”
While talking to Business India, Kuusk revealed that there was only a basic diplomatic presence between Russia and Estonia. “It’s difficult to have relations with your enemy.” Kuusk reiterated that intel operations were an integral part of Russian embassies – not just in Estonia but across the EU, as a result of which they continue to focus on defence preparedness. Estonia takes 4,000 conscripts every year, but its army is a reservist. Mostly retrained and recalled – with a wartime tally of 50,000 – substantial for a country which has a population of 1.3 million.
Kuusk acknowledged that his country was seeking support from nations with shared democratic values, which included India. “Estonia remains open to affordable Indian offers that confirms with its internal requirements,” he stated. “We are looking at investing in drones and discussing these options with India.” Kuusk was Estonia’s ambassador to Ukraine when the Ukraine-Russia war broke out and stayed there for 18 months after that. “I was woken up by a cruise missile blast when the war began. I wouldn’t want anyone to go through the feeling that someone is trying to kill you. Russia was aware that there were diplomats in Kyiv, and yet it went on with the attack,” Kuusk added.