India zips into a frenzy of free trade agreements and preferential trade agreements. This mirrors a global cascade surpassing 370 pacts by late 2025. These instruments harbor immense potential to catalyze exports, lure investments, and rewire supply chains. Yet empirical scrutiny unmasks chronic deficits, tepid utilization, and industrial strains that erode net productivity. A dispassionate dissection anchored in government data and expert dissections reveals selective triumphs overshadowed by systemic frailties. Surgical reforms remain essential for genuine economic alchemy.
Global Cascade Unpacked
Regional trade agreements erupted from fewer than 10 accords in 1990 to over 370 today per World Trade Organization tallies. Nations navigate tariff tempests, supply chain ruptures, and US-China schisms amplified by President Trump's bilateral barrages. Mega-frameworks like the Regional Comprehensive Economic Partnership span 30 percent of global GDP. They propel intra-bloc commerce 5 to 13 percent annually. The Comprehensive and Progressive Agreement for Trans-Pacific Partnership eradicates tariffs on 95 percent of goods. Gravity model rigor exposes a sobering truth though. Eighty percent of world trade persists under most-favored-nation rates. Pacts often divert rather than birth flows.
India's Sprawling FTA Matrix
India stewards 13 free trade agreements and six preferential trade arrangements. It unleashed five pivotal ones since 2020 with United Arab Emirates, Australia, Mauritius, and European Free Trade Association. The United Arab Emirates compact vaulted bilateral trade from 43 billion dollars in 2022 to 84 billion dollars in 2025 through 90 percent duty excision. Australia elevated merchandise exports 14 percent to 18 billion dollars in fiscal 2024-25. European Free Trade Association enshrines 100 billion dollars in investments alongside one million jobs across 15 years. Pipeline deals with European Union, United Kingdom, Oman, New Zealand, Chile, Israel, and Canada pursue 90 to 99 percent tariff nullification. Rules-of-origin labyrinths and compliance thickets cap utilization at 10 to 40 percent though. This falls far below partners' 65 to 70 percent benchmarks.
Empirical Ledger: Gains Versus Gaps
Fiscal 2024-25 etched export pinnacles at 825 billion dollars ascending 6 percent overall and 14 percent in services to 388 billion dollars. Free trade agreements turbocharged electronics 42 percent to 29 billion dollars, engineering goods 5 percent, and pharmaceuticals 6 percent. Non-oil outflows to partners surged 20 percent yearly in marquee cases. Department of Commerce year-end reviews credit these for diversifying from China-centric chains into semiconductors and renewables. Counterbalancing deficits ballooned catastrophically though. ASEAN rose by 302.9 percent, South Korea 164.1 percent, Japan 138.2 percent from pre-pact baselines. India's 10 to 15 percent duties dwarfed partners' near-zero most-favored-nation rates. This unleashed import tsunamis in electronics, chemicals, and autos that hollowed manufacturing and shed jobs in textiles and MSMEs.
Structural Fault Lines Dissected
Underutilization plagues pacts with ASEAN hovering at 30 to 40 percent due to documentation quagmires, non-tariff barricades, and origin certification snarls per NITI Aayog diagnostics. Services liberalization, India's ace, languishes. Only eight of 19 accords encompass it. ASEAN and South Korea drag on end dates amid resistance from low-wage blocs. Elevated Indian tariffs invite surges. Carbon border adjustments threaten steel and cement exports. Monopoly oversights and labor mobility clauses risk sovereignty erosion. Older deals codified flat export shares. ASEAN dipped from 10.2 to 10.8 percent post-implementation exacerbated by Chinese transshipments routing through Singapore.
Geostrategic Calculus Interwoven
Economist Manoj Pant, former Indian Institute of Foreign Trade vice-chancellor, incisively posits that regional trade agreements transmute from economic levers to political safety nets in a US-China Big Two epoch. Trump's WTO disengagement scrambles Quad architectures. India's ASEAN and Australia pacts prioritized Indo-Pacific bulwarks over trade arithmetic yielding stasis. An India-Russia free trade agreement idle four years resurfaces as energy bulwark amid Quad volatilities and 30 billion dollars annual trade upside. Pant cautions the Ministry of External Affairs must cede to Commerce Ministry empirics though. RTAs will be driven far more by strategic considerations than economic logic but absent math they falter. Gravity models forecast 236 percent trade creation in refined emerging blocs realizable only via symmetry.
Forge-Ahead Doctrine
True productivity mandates 95 percent reciprocal tariff demolition, ironclad investment bindings, relaxed origins rules, and robust safeguards against surges. Fuse this with 25,000 crore rupees export propulsion through 2031 for high-tech niches. Domestic sinews per NITI Aayog demand electricity price rationalization, man-made fiber incentives, skilling revolutions, and stakeholder vetoes to vault utilization to 25 percent by 2030. Review laggards like ASEAN for termination if deficits persist as government signals. This evidence-tempered blueprint weddings geopolitical savvy to Commerce calculus. It transfigures free trade agreements from deficit vortexes to trillion-dollar accelerators crowning India as multipolar trade sovereign.
[Major General Dr. Dilawar Singh, IAV, is a distinguished strategist having held senior positions in technology, defence, and corporate governance. He serves on global boards and advises on leadership, emerging technologies, and strategic affairs, with a focus on aligning India's interests in the evolving global technological order.]
