India is actively pursuing a multi-pronged trade strategy to navigate an unpredictable global environment. The country is focused on boosting its export competitiveness, diversifying its trade partners, and finalizing key agreements.
Here’s a breakdown of the current trade landscape:
Free Trade Agreements (FTAs)
- EFTA: A major trade pact with the European Free Trade Association (EFTA) is set to come into force on October 1. The four-nation bloc—comprising Switzerland, Norway, Iceland, and Liechtenstein—has pledged a $100 billion investment in India over 15 years, and this agreement will give Indian exporters preferential duties.
- UK: The Commerce Ministry is urging the United Kingdom to expedite its FTA implementation.
- Australia: India’s Economic Cooperation and Trade Agreement (ECTA) with Australia is proving highly effective, with an 84% utilization rate for export lines and 86% for import lines. This indicates the pact is being fully leveraged by both sides.
U.S. Trade Relations
India remains “fully engaged” in trade talks with the United States. A new round of high-level talks is planned for late August, with the goal of completing a Bilateral Trade Agreement (BTA) by September or October to double bilateral trade. However, a key sticking point is the additional 25% tariffs the U.S. has imposed, which are rooted in geopolitical considerations rather than trade disputes. The outcome of these tariffs is expected to be clarified before August 27.
Trade Diversification and Promotion
In response to global uncertainty, India is expanding its trade focus from 20 to 50 key markets, covering 90% of its total exports. This strategy is already yielding results, with the Agricultural and Processed Food Products Export Development Authority (APEDA) having introduced 15 new food products into 28 new markets between April and July 2025.