India and Cyprus are discussing a plan to begin building the India-Middle East-Europe Economic Corridor (IMEC) from the Mediterranean, linking India with Cyprus, Greece and Italy as early building blocks for the broader project.
Cypriot officials describe IMEC as a potential foundation for a new economic and trade security architecture in the region. They say the corridor should begin in the Mediterranean and be open to countries that share similar values and principles, creating a positive agenda for cooperation.
Since Prime Minister Narendra Modi’s visit to Cyprus last year, bilateral ties have moved toward a strategic partnership. Nicosia is positioning itself as a gateway for Indian industry and technology into the EU market, offering services such as CE certification that can facilitate large volumes of Indian exports to Europe following the EU-India trade step announced in January.
Cyprus expects Indian firms that invest on the island to gain seamless access to the wider European market across multiple sectors. Officials also praised India’s progress on public digital infrastructure and artificial intelligence ecosystems, and said Cyprus could serve as a testing hub for Indian technologies aimed at European customers.
On trade policy, Cypriot authorities said legal work on a dynamic Free Trade Agreement is being expedited. Their EU presidency began with the announcement of the FTA in January, and both sides are preparing the necessary commissions and legal documents to move toward a prompt signing.
In a notable shift toward defence cooperation, Cyprus intends to purchase military hardware from India and to pursue cooperation between their defence industries. Nicosia has allocated a defence budget of 1.2 billion euros to enhance its capabilities and is exploring specific Indian systems that have been operationally tested.
Cyprus is closely monitoring regional security dynamics, including cross-border incidents involving Pakistan, and said discussions also touched on developments related to Turkey.
To strengthen people-to-people and business links, Nicosia has opened high-level talks with major Indian carriers, including Air India and IndiGo, with a target of starting direct flights by the end of the year.
Financial integration is also advancing: Eurobank, which has opened a representative office in Mumbai, plans to introduce India’s Unified Payments Interface (UPI) in Cyprus next year. Initially the service will be available to Indians in Cyprus, with expansion to non-Indian users expected thereafter.
To support the expanding partnership, Cyprus will increase diplomatic staffing at its High Commission in New Delhi.
On global governance, the Cypriot delegation criticized the United Nations’ handling of crises such as those in Ukraine and Iran and strongly endorsed India’s bid for permanent membership on the UN Security Council, saying UN reform should include India and raising the issue with EU partners.
Cultural ties are also growing: the first Bollywood film shot in Cyprus, titled Ishqaa, is due to begin filming in June and is scheduled for a Valentine’s Day release next year.
