India Engaged in Free Trade Agreement Talks with US, EU, New Zealand
Commerce Minister Piyush Goyal announced that India is actively negotiating Free Trade Agreements (FTAs) with several key economic partners, including the United States, the European Union, New Zealand, Oman, Peru, and Chile. The talks aim to significantly boost bilateral trade and strengthen economic ties. Goyal also confirmed that the recently signed trade pact with the four-nation EFTA bloc (Switzerland, Iceland, Norway, Liechtenstein), which includes a $100 billion investment commitment, will come into effect on October 1.
Unpacked:
India and the US have held five rounds of talks, aiming to conclude the first tranche of their agreement by late 2025. With the EU, 12 rounds of negotiations have taken place, with recent focus on core chapters and market access. Both aim to finalize an agreement by the end of 2025.
The EFTA agreement aims to boost trade in goods, services, and investments between India and EFTA countries, with a $100 billion investment commitment. It is expected to enhance India’s global trade presence, open new markets, and attract significant foreign investment, supporting economic growth.
India seeks to diversify its trade partners, strengthen economic resilience, and boost exports. Active FTA negotiations reflect India’s goal to become a $5 trillion economy by expanding market access, attracting foreign investment, and reducing reliance on any single trading bloc. Recent global disruptions have also encouraged broader trade partnerships.
Challenges include disputes over tariffs (such as US penalties on Indian goods), differing regulatory standards, and negotiations over sensitive sectors like services and intellectual property. Progress has been steady but slow, as both sides seek mutually beneficial solutions to complex trade and investment issues.