What happened?
On Sunday, External Affairs Minister S Jaishankar stated that India’s recent trade pacts are “significant achievements” and that New Delhi’s push for Free Trade Agreements (FTAs) is the “space to watch”. He highlighted that over the past 11 years, India has pursued trade pacts with countries having “more mature markets,” which are “more transparent and rule bound” compared to East Asian nations. Jaishankar mentioned that an FTA with the United Kingdom is nearly finalised, negotiations with the European Union are in advanced stages, and several rounds of talks have occurred for a bilateral trade agreement with the US. In an interview, he explained that after economic reforms, most of India’s trade agreements were with Southeast Asian nations, which “skewed the balance” as many of these economies competed with India and did not provide sufficient market access. He emphasised the importance of correcting this by engaging with more mature and transparent markets.
Why it matters to India
India’s strategic shift towards FTAs with mature and rule-bound markets is critical for its economic growth and integration into the global economy. This approach aims to secure better market access and fairer trade practices, moving away from past agreements that may have created imbalances. The emphasis on deepening strategic posture and fostering good relations with diverse countries reinforces India’s vision of a multi-polar world, enhancing its global influence. Furthermore, the focus on bolstering border infrastructure, particularly concerning China, is vital for safeguarding India’s territorial integrity and national security. Jaishankar’s candid assessment of neighbourhood relations, highlighting the benefits of cooperation with India, underscores India’s assertive diplomacy in its immediate vicinity.