ROLE OF INDIA'S FREE TRADE AGREEMENTS (FTAs) IN DRIVING EXPORT GROWTH AND MARKET DIVERSIFICATION

Abstract

India has, since 2022, moved from a largely defensive trade policy stance to an active pursuit of bilateral and plurilateral Free Trade Agreements (FTAs), signing or concluding agreements with the United Arab Emirates (CEPA, 2022), Australia (ECTA, 2022) and the four-nation European Free Trade Association (TEPA, 2024), and concluding negotiations with the United Kingdom (CETA, 2025), while long-running talks with the European Union continue. This paper uses secondary data to examine whether, and how, these agreements have contributed to India's export growth and market diversification. It reviews the design of recent FTAs, synthesises available trade statistics for partner countries before and after agreements took effect, and develops a conceptual framework linking FTA design to export outcomes through enabling conditions such as exporter compliance capacity and awareness of preferential tariff schemes. The analysis suggests that FTAs have coincided with strong bilateral trade growth with partners such as Australia and the UK, but that low utilisation rates among exporters, persistent non-tariff barriers, and India's continued protection of sensitive sectors such as agriculture and dairy limit the full realisation of gains. The paper concludes that FTAs are a necessary but not sufficient lever for export transformation, and that complementary measures — exporter awareness campaigns, trade facilitation, and logistics investment, are required to convert preferential access into higher, more diversified exports.