The attempt to promote free trade while promoting protectionism under the guise of “atmanirbhar Bharat?”. You can`t have your cake and eat it! Either you open up to trade or you don`t. Earlier this year, Trade and Industry Minister Piyush Goyal met on the sidelines of the World Economic Forum in Davos with EU Trade Commissioner Phil Hogan, Mexican Economy Minister Graciela Mérquez Colén, South African Trade Minister Ebrahim Patel and Japanese Minister of Economy, Trade and Industry Hide , to improve bilateral trade prospects. Fourth, India could focus more on bilateral trade agreements than multilateral agreements. Negotiations on the Comprehensive Regional Economic Partnership (RCEP) have encouraged India to learn in the strongest possible terms. India`s last-minute decision to withdraw from the RCEP in 2019 was prompted by the industry`s appeal to the Modi government. In retrospect, given China`s dominance in the trade pact and India`s reluctance to open its domestic market to Chinese producers known for their subsidy and dumping practices, the decision was reasonable. First, there have been a number of lessons learned from the experience of our previous free trade agreements. In 2018, a NITI-Aayog note on free trade agreements reported india`s unrivalled and growing trade deficits as a result of free trade agreements with ASEAN, Japan and Korea. It is important that the deficit has also widened for India`s dominant value-added sectors, reflecting a deterioration in the quality of India`s trade with its free trade partners. It is a list of free trade agreements between two parties in which each party could be a country (or another customs territory), a trade bloc or an informal group of countries. Read also: Modi started out as a champion of free trade, but ends as a protectionist But in this heightened context where most nations are cautious in their trade strategy, India must focus on deep bilateral free trade agreements with trading partners where there are maximum trade complementarities, including the United States and the EU.
In the United States, our untapped export potential as a percentage of current exports is around 60%, compared to 90% for the EU. India`s tactical transition from multilateralism to bilateral engagement came at a crucial time. Even before Covid-19 caused chaos, world trade experienced increased uncertainty. A trade war between the United States and China and a collapse of the WTO appeal system to the WTO had only increased the challenges for India, which had been a strong advocate of the multilateral trading system. A comprehensive analysis of trade between India and its key free trade partners, discussed above, shows a significant increase in trade since the agreements came into force. SAFTA came into force on 1 January 2006 and, according to the Ministry of Trade and Industry, bilateral trade between India and other SAFTA member states increased from $6.8 billion in 2005-06 to $28.5 billion in 2018-19. India`s trade with SAFTA grew faster than its overall trade with the world. As a result, SAFTA`s share of India`s international trade increased from 1.6% in 2005-06 to 2.5% in 2018-19. At the same time, Indian exports to SAFTA countries grew faster than their imports from them, resulting in a significant increase in the trade surplus with these economies from about $4 billion to $21 billion.
The maximum growth in exports to the SAFTA REGION was recorded with Bangladesh and Nepal. India has not avoided efforts at “balanced” trade agreements, despite further efforts at independence, and discussions with key partners, including the United States, the EU and Australia, will gain momentum as soon as the effects of the pandemic diminish significantly, an official source told the FE.