India's Trade Agreements (Economy)
India's Trade Agreements (Economy)
Why In News:
Recently, there has been a shift in India's trade policy focus, from merely signing Free Trade Agreements (FTAs) to ensuring their effective utilisation by exporters, backed by rising export figures and digital trade facilitation tools.
Changing Focus of India’s FTA Policy
India’s trade policy is increasingly moving beyond simply negotiating and signing Free Trade Agreements (FTAs) towards ensuring that Indian exporters are able to effectively utilise the preferential market access created by these agreements.
The shift is important because an FTA can reduce tariffs on paper, but the actual export benefit depends on exporters meeting rules of origin, product standards, documentation and other market-entry requirements.
This approach is supported by rising external trade.
India’s goods and services exports reached USD 863.1 billion in FY 2025-26, while exports during April–June 2026 stood at USD 232.73 billion, registering 11.37% year-on-year growth.
Digital Tools for FTA Utilisation
Preferential Certificate of Origin (CoO): A Certificate of Origin establishes the country of origin of exported goods and enables eligible importers to claim preferential customs duties under an FTA.
e-CoO 2.0: Provides a digital mechanism for issuing and verifying Certificates of Origin, reducing paperwork and facilitating faster compliance with FTA requirements.
Trade Connect ePlatform: Helps exporters, particularly MSMEs, identify tariffs, market opportunities, applicable FTAs and other trade-related requirements for specific products and markets.
These digital tools aim to bridge the gap between preferential access negotiated by the government and its actual utilisation by exporters.
Key Facts for Prelims
FTA Utilisation: Signing an FTA and actually using its tariff preferences are different; utilisation depends on factors such as rules of origin, documentation and compliance with destination-country standards.
India’s FTA Institutional Framework: The Department of Commerce under the Ministry of Commerce and Industry is the nodal government department for trade negotiations and monitoring of India’s trade agreements, while digital platforms such as Trade Connect support exporters in accessing the benefits of these agreements.