Commerce and industry minister Piyush Goyal on Thursday called for a nationwide drive to boost the utilisation of India’s free trade agreements (FTAs), urging states, industry bodies and export promotion councils to take the benefits of preferential market access to individual districts, MSMEs and first-time exporters.
Addressing a national workshop in New Delhi on leveraging FTAs, Goyal said India’s nine FTAs currently cover economies representing about $60 trillion in GDP and provide preferential access to nearly two-thirds of global trade.
He said the upcoming trade agreements and efforts to deepen market access could eventually give India access to about 75% of global trade at rates lower than those available to competing countries.
“Ultimately, a PTA, FTA or BTA is about obtaining a rate better than that of India’s competition,” Goyal said, adding that the absolute tariff level was less important than the rate faced by competing countries.
Goyal said India should assess its tariff position against competitors such as Vietnam and Bangladesh, particularly in sectors such as , where Indian exporters have historically faced higher duties in developed markets.
The minister said India had now secured rates better than those of competing geographies in almost all developed markets, leaving exporters to focus on scale, quality, timely delivery and maintaining customer trust.
“The ball is now entirely in our court,” he said.
India has set a target of $1 trillion in exports for the current year, implying a growth of about 16%, Goyal said. Exports during April-July reached about $317 billion, compared with about $280 billion in the corresponding period a year ago.
Goyal said the current trend was encouraging and exports typically accelerate as the country moves towards the Christmas period, with the final quarter generally recording the strongest performance.
India’s operational FTAs include those with Mauritius, Oman, the UAE, Australia and the UK, while the agreement with the 4-nation European Free Trade Association (EFTA) is expected to become operational followed by the New Zealand agreement, according to Goyal. The European Union’s 27 countries are also expected to be covered subsequently.
He said negotiations or efforts to deepen market access were also underway with Canada, Mexico, Chile, Mercosur, the Southern African Customs Union (SACU), the Gulf Cooperation Council (GCC) and Israel, besides efforts to review India’s trade arrangements with the Association of Southeast Asian Nations (ASEAN), South Korea and Japan.
On the proposed India-US bilateral trade agreement, Goyal said the deal would be finalised once the US was able to provide India a preferential rate compared with its competitors, after which the finer details would be announced.
Goyal said all nine FTAs had secured a “good deal” for India, with sensitive sectors, including agriculture, fisheries, MSMEs and workers, protected through negotiations and stakeholder consultations.
He called for the FTA outreach programme to reach all of India’s 780 districts and cover traders, entrepreneurs, startups, women entrepreneurs and small businesses.
The minister said the Department of Commerce and Department for Promotion of Industry and Internal Trade (DPIIT) would lead the effort, while other ministries, including textiles, pharmaceuticals, chemicals and electronics, would also need to be involved.
He asked states to identify products and clusters where FTA benefits were already being utilised as well as areas where the benefits remained underused. States should also identify first-time exporters and new products that could gain from access to
Goyal said e-commerce could provide micro, small, and medium enterprises (MSMEs) and first-time exporters with a lower-barrier route into international markets and called for greater use of the channel for exports.
He also asked export promotion councils to strengthen their engagement with industry and disseminate information on FTA benefits in local languages and easy-to-consume formats. Industry associations, he said, should similarly reach smaller businesses and set export targets.
The minister proposed sector- and cluster-level workshops and a facilitation mechanism with points of contact at the district or state level. Responses to exporters seeking support should be fast and, wherever possible, instantaneous and online, he said.
Goyal also called for support for exporters through the Export Promotion Mission, including on regulatory approvals, sanitary and phytosanitary (SPS) measures, technical barriers to trade (TBT) and freight compensation, where required.
He said exporters would receive priority support for the proposed 100 BHAVYA plug-and-play industrial parks, including concessions for those committing to higher export levels. Existing clusters through the Export Promotion Mission or industrial parks would also be supported.
The minister said India should remain a trusted trading partner and ensure that products entering global markets meet international standards. He also stressed the importance of country-of-origin certification and said India should not become a conduit for products that did not meet ethical standards.
Goyal reiterated the government’s longer-term ambition of taking exports towards $2 trillion by 2030 despite the disruptions caused by the covid-19 pandemic, wars and other global challenges.
The workshop brought together officials from the Centre, states and Union territories, export promotion councils and industry associations to identify export opportunities and constraints in utilising .
Commerce secretary Rajesh Agrawal said the workshop aimed to bring stakeholders together and disseminate sector-specific export opportunities to states. Breakout sessions focused on export clusters, products, practical constraints in FTA utilisation and support required from the central government.