{"id":2093,"date":"2025-11-26T08:12:10","date_gmt":"2025-11-26T08:12:10","guid":{"rendered":"https:\/\/www.iiiem.in\/blog\/?p=2093"},"modified":"2025-12-15T05:12:22","modified_gmt":"2025-12-15T05:12:22","slug":"free-trade-agreements-of-india-as-of-2025","status":"publish","type":"post","link":"https:\/\/www.iiiem.in\/blog\/free-trade-agreements-of-india-as-of-2025\/","title":{"rendered":"Free Trade Agreements of India as of 2025"},"content":{"rendered":"

India\u2019s Free Trade Agreements (FTA)<\/strong><\/h2>\n

An FTA is a legally binding pact<\/strong> that creates a free-trade area<\/strong> where member countries agree to give preferential treatment to each other’s goods and services compared to those from countries outside the agreement.<\/p>\n

    \n
  1. \n

    The Core Mechanism: Eliminating Trade Barriers<\/strong><\/h4>\n<\/li>\n<\/ol>\n

    The most significant aspect of an FTA is the removal of the following obstacles:<\/p>\n

      \n
    1. \n
      Tariffs (Import Duties):<\/strong> This is the main focus. An FTA generally commits countries to reduce or completely eliminate taxes (tariffs) on products imported from the partner country.<\/h5>\n<\/li>\n<\/ol>\n

      Example:<\/em> If India has an FTA with Country X, and Country X normally charges a 10% tariff<\/strong> on imported cars, under the FTA, that tariff might drop to 0%<\/strong> for cars made in India. This makes Indian cars cheaper and more competitive in Country X’s market.<\/p>\n

        \n
      1. \n
        Quotas:<\/strong> Restrictions on the volume (quantity) of specific goods that can be imported are also often eliminated or substantially raised.<\/h5>\n<\/li>\n<\/ol>\n

        2. Beyond Goods: A “Comprehensive” Approach<\/h4>\n

        Modern trade agreements (often called CEPA or CECA, like India uses) go far beyond just goods.<\/p>\n

        Example:<\/p>\n

        CEPA \u2013 Comprehensive Economic Partnership Agreement<\/p>\n

        CACA \u2013 Comprehensive Economic Cooperation Agreement<\/p>\n

        In short, both CECA and CEPA are terms India uses to signify a trade agreement that is much wider in scope<\/strong> than a simple FTA that only deals with merchandise trade.<\/p>\n

        CEPA or CECA typically include provisions on:<\/p>\n

        \"\"<\/p>\n

        Why Countries Sign FTAs<\/h3>\n
          \n
        1. Economic Growth: By removing tariffs, trade volume increases, which can boost exports, manufacturing, and overall economic activity.<\/li>\n
        2. Lower Prices & Greater Choice: Consumers benefit from a wider variety of imported goods at lower prices due to reduced taxes.<\/li>\n
        3. Increased Competition: Domestic companies must become more efficient and innovative to compete with cheaper, tariff-free imports.<\/li>\n
        4. Better Market Access: FTAs provide businesses with stable, preferential access to a larger pool of international customers.<\/li>\n<\/ol>\n

          Types of FTAs<\/h3>\n
            \n
          1. Bilateral: An agreement between two countries (e.g., India-Japan CEPA).<\/li>\n
          2. Multilateral: An agreement among three or more countries or a trade bloc (e.g., ASEAN-India FTA).<\/li>\n
          3. PTA: It is the most basic form of a trade pact where member countries agree to reduce (but not eliminate) tariffs on a limited list of products traded among them, granting preferential treatment over non-member countries. It is generally less comprehensive than a Free Trade Agreement (FTA) or a CEPA.<\/li>\n<\/ol>\n

            FTAs are a crucial tool in international trade, allowing countries to customize trade rules and gain a competitive edge in specific markets.<\/p>\n

            India has a mix of Bilateral Free Trade Agreements (FTAs) and Preferential Trade Agreements (PTAs) with individual countries, as well as multilateral agreements with trade blocs.<\/p>\n

            Here is a list of India’s major Bilateral and Multi-lateral Free Trade and Economic Cooperation Agreements in force:<\/p>\n

            India’s Bilateral Trade Agreements (FTAs\/CEPA\/CECA\/PTA)<\/h3>\n

            These agreements are typically with a single country, though the names can vary: FTA, CECA, CEPA, PTA<\/p>\n

            \"\"<\/p>\n

             <\/p>\n

            \"\"<\/p>\n

            India\u2019s FTA negotiations are going on with the below listed countries:<\/p>\n