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Free Trade Agreements Push Gains Momentum: India Eyes Deals With EU, US, New Zealand
The year 2026 will be the year of free trade agreements. India is likely to sign FTAs with the European Union and New Zealand. Implementation of the FTA with the UK will begin in March or April. Trade agreements are also possible with Peru and Chile. CIPA with Oman is scheduled for December 18th.
In the area of trade, the year 2026 will shape up as the year of free trade agreements (FTAs). The initial FTA in the coming year can actually start with the European Union (EU), then later with the country of New Zealand. Also expected in the coming year are the start of trade agreements with Peru and Chile.
Nine rounds of trade negotiations have been held for a trade agreement with Peru, and four for one with Chile. Negotiations for a trade agreement with Canada have recently been reopened and are now underway. Six rounds of negotiations for a bilateral trade agreement with the US have also been held, with the first phase of this agreement possibly being reached during the coming year.
According to Commerce Ministry sources, the Commerce and Industry Minister will visit Brussels, the headquarters of the European Union, in January, and it is highly expected that the trade agreement between India and the EU will be finalized during this period. The EU team was in India between December 3 and 9 for trade negotiations. A meeting was held between the EU and Indian Commerce Ministers on December 8-9, where various instructions were given to the teams on finalizing the trade agreement.
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The EU comprises more than two dozen countries, including developed nations like France, Germany, Italy, Belgium, and Spain. A trade agreement with the EU could boost Indian exports to new heights in the upcoming financial year 2026-27. FTAs with Chile and Peru will open new doors for Indian trade in South America. It is not clear that FTAs with the EU and other countries will only benefit commodity exports.
All FTAs are also prioritizing the movement of people and services, including the services sector. This will benefit Indian workers and professionals by increasing IT and other service exports to these countries. This will also contribute to foreign exchange earnings. Another advantage of FTAs with various countries is that India will no longer be dependent on any single country for exports, and the market options for Indian exports will expand.
The Comprehensive Economic Partnership Agreement (CEPA) is scheduled to be signed between India and Oman on December 18th. Negotiations regarding the CEPA have been ongoing between the two countries for the past two years. Prime Minister Narendra Modi is currently on a three-nation tour and will finally visit Oman.
Oman is a member of the Gulf Cooperation Council (GCC). Therefore, a CEPA with Oman will also help increase trade with other GCC member countries. Oman and India have a trade volume of $10.6 billion. India's exports from these countries amount to $4.1 billion. India imports items such as gas and petroleum products from Oman.
