Commerce and industry minister Piyush Goyal on Tuesday held a meeting to review the ongoing negotiations for free trade agreements (FTAs) with various countries in a bid to expedite the talks and boost export prospects.
The meeting comes at a time when demand from India’s key markets such as the US and the EU are expected to slow down due to recession there. Exports to China, the fourth-largest destination for India, crashed 31% in the June quarter from a year before. Given the strong external headwinds, Goyal has already asked industry to study various FTAs that the country has signed and identify areas where domestic suppliers have competitive edge so that they can boost exports.
Deliberations on ways to fast-track negotiations are on “to achieve mutually beneficial FTAs, paving the way for increased exports, investments & people to people ties”, Goyal’s office said in a tweet on Tuesday.
India is either negotiating or planning to start talks for a flurry of high-stake FTAs with key economies, such as the EU, the UK, Canada, Israel, members of Gulf Co-operation Council (GCC) and Australia. While New Delhi has clinched an interim deal with Canberra, talks for a full-fledged FTA could start soon. Together these economies (excluding the UAE, a part of the GCC, with which an FTA is already signed) contributed as much as $108 billion, or 26%, to India’s merchandise exports in FY22. Both India and the UK are eying a deal by Diwali this year (October 24).
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India’s merchandise export growth slowed down to just 2.1% on year in July to $36.3 billion. However, in the first four months of this fiscal, exports grew 20.1% to $157.4 billion.
Goods exports had hit a record $422 billion in FY22, far exceeding the earlier peak of $330 billion, on the back of an industrial resurgence in advanced economies, which is now losing momentum.
