European Council President António Luis Santos da Costa and European Commission President Ursula von der Leyen will be the chief guests at India's Republic Day celebrations on Monday.

Along with the state dinner and formal events, an important issue will be on the agenda of the two leaders. Push for free trade talks with Asia's third-largest economy, India.

This is happening at a time when Europe is going through a difficult period. US President Donald Trump first threatened to intensify the trade war against European allies over opposition to US control of Greenland and later withdrew from the selection of the chief guest, also indicates India's diplomatic thinking. India is intensifying its strategic and trade relations with other parts of the world.

The standoff over the 50 percent tariff imposed by the US on India seems to be stretching until the new year. Kshitij Bajpai of Chatham House, a London-based think tank, told the media, “This indicates that India's foreign policy is diversified and not dependent on the wishes of the Trump administration.”

Some reports said the agreement could be announced when the leaders of the two sides meet at a high-level summit on January 27.