From Caution to Command: Why India’s Latest Trade Deals Could Change the Global Game
- Joydeep Chakraborty
- Jan 21
- 6 min read
Once cautious and hesitant, India’s trade diplomacy has transformed into a calculated, high-stakes game where every agreement is a move in a global chessboard of commerce and strategy. Between 2015 and 2020, India largely stayed on the sidelines. While other nations aggressively pursued trade deals, India hesitated. Legacy agreements underperformed, domestic industries worried about exposure to global competition, and scepticism toward FTAs grew amid a volatile world marked by tariff wars, pandemic shocks, and rising geopolitical tensions.
This caution was understandable, but it came at a cost. India’s global trading position stagnated, and opportunities to shape supply chains, investment flows, and regional alliances were missed. However, between 2021 and 2025, a strategic pivot occurred. India moved from defensive caution to proactive architecture, treating each trade agreement not as an isolated deal but as a deliberate instrument to plug vulnerabilities and unlock economic potential.
Reopening Africa: India–Mauritius CECPA (2021)
India’s CECPA with Mauritius, signed in February 2021, symbolised a bold first step in this new approach. Mauritius had historically functioned as a financial conduit for Indian investments in Africa rather than a full trade partner. Past changes to the Double Taxation Avoidance Agreement introduced uncertainty, limiting India’s ability to use Mauritius strategically.
Key Features and Strategic Benefits:
Preferential access for Indian textiles, pharmaceuticals, engineering goods, and agricultural products.
Market openings for select Mauritian exports.
Services liberalisation spanning finance, IT, professional services, and education.
Clearer rules on taxation, investment protection, and dispute settlement.
In 2021, Indian pharmaceutical exporters like Cipla and Sun Pharma discovered a new route to African markets. Reduced tariffs and regulatory certainty enabled medicines to reach hospitals in Kenya and Tanzania faster. Mauritius transformed from a mere financial conduit into a practical trade hub, demonstrating the CECPA’s real-world impact.
This agreement was less about headline trade volumes and more about strategic access. By leveraging Mauritius as a trusted partner, India created a modular Africa strategy, gaining both economic and soft-power advantages without direct engagement with multiple countries.
Predictable taxation, faster market entry, and strengthened investment links made Mauritius a reliable gateway for Indian goods and services across Africa.
Rapid Scaling in the Gulf: India–UAE CEPA (2022)
While Mauritius opened India’s door to Africa, the UAE CEPA demonstrated how speed and scale could amplify trade impact. Signed in February 2022, the agreement took just under 90 days, India’s fastest-ever FTA negotiation.
Key Features:
Duty-free access for over 90% of Indian exports: gems, textiles, footwear, pharmaceuticals, agricultural products, and engineering goods.
Phased tariff reductions on imports like petrochemicals, aluminium, and copper.
Services liberalisation, professional mobility, digital trade, and customs facilitation.
Within months, Arvind Limited, an Indian textile exporter, reported a surge in shipments to Dubai and Abu Dhabi. The company began using UAE ports to re-export goods to Africa and Europe, turning the UAE into a regional distribution hub.
The UAE CEPA is a blueprint for trust-based, politically aligned, rapid execution. It also strengthened India’s energy-security collaboration, showing that FTAs can serve both economic and geopolitical purposes.
Faster customs clearance, reduced compliance costs, and improved access to regional and re-export markets reinforced the UAE’s role as India’s Gulf hub. Where Mauritius emphasised strategic gateway access to Africa, the UAE CEPA highlighted scale, speed, and operational efficiency, demonstrating India’s dual approach to global trade.
Zero-Duty Access and Indo-Pacific Anchoring: India–Australia ECTA (2022)
Signed in April 2022, the India–Australia Economic Cooperation and Trade Agreement (ECTA) offered 100% tariff elimination on Australian exports. This was the first time India extended such comprehensive liberalisation.
Key Features:
Duty-free access for Indian textiles, leather, footwear, gems, pharmaceuticals, and engineering goods.
Australian exports of minerals, coal, and agricultural inputs are essential for Indian manufacturing and energy.
Expanded visa quotas and post-study work options for Indian professionals and students.
Cooperation on technical barriers, standards, and dispute resolution.
Bata India, a leather footwear brand, was among the first to benefit. Shipments to Australia surged within weeks, while small exporters saw reduced customs delays, enabling MSMEs to access a strategic market efficiently.
ECTA reinforced India’s Indo-Pacific strategy by embedding trade within trust, supply-chain resilience, and regional cooperation. Unlike UAE CEPA, which prioritised speed, or Mauritius CECPA, which emphasised gateway access, ECTA centred on long-term, partner-specific engagement and economic trust.
Immediate zero-duty access and a predictable regulatory environment allowed businesses to plan confidently, facilitating faster market expansion.
Depth Over Volume: India–Oman CEPA (2025)
While the UAE CEPA focused on rapid trade growth, Oman represented strategic depth. Signed in 2025, India’s CEPA with Oman covered its highest-ever tariff coverage with a GCC country, going beyond trade volumes to foster resilience in energy and supply chains.
Key Features:
Liberalisation across industrial goods, agricultural products, and intermediate inputs.
Strong services trade, investment facilitation, and customs cooperation.
Alignment with energy security, port connectivity, and industrial collaboration.
The CEPA created a sector-specific Gulf engagement template, prioritising reliability over sheer trade numbers. Indian engineering, chemical, and food exporters gained broader market access, while India extended calibrated concessions on Omani energy and minerals.
India’s Gulf strategy now demonstrates intentional modularity: the UAE for scale, and Oman for strategic depth, showing a mature understanding of geoeconomic contexts.
Speed and Balance: India–New Zealand FTA (2025)
Negotiated in just nine months, the New Zealand FTA highlighted modern tradecraft in action. Past negotiations had stalled over sensitive sectors like dairy and agriculture. This time, pragmatism prevailed.
Key Features:
Market access for pharmaceuticals, textiles, chemicals, engineering goods, and IT services.
Safeguards for sensitive agricultural sectors.
Regulatory cooperation, standards recognition, and digital trade facilitation.
Indian pharmaceutical and IT exporters leveraged the agreement to deliver medical devices and software faster, reducing bureaucratic friction almost immediately.
New Zealand sets high-quality trade norms. The agreement demonstrated India’s ability to negotiate advanced, modern trade arrangements while protecting domestic priorities.
Faster approvals, reduced procedural barriers, and clarity in regulatory compliance. Speed and balance now complement trust and strategic depth in India’s Indo-Pacific approach, reflecting a nuanced, partner-specific strategy. From zero-duty access in Australia to rapid, nine-month negotiations with New Zealand, India demonstrated that modern tradecraft is as much about trust and pragmatism as tariffs and quotas.
Post-Brexit Recalibration: India–UK CETA (2025)
As the UK recalibrated its post-Brexit partnerships, India turned negotiation maturity into an advantage. The India–UK CETA, concluded in 2025, combined deep market access with strategic positioning in Europe.
Key Features:
99% tariff-free access for textiles, apparel, leather, engineering goods, chemicals, and processed foods.
Services trade and professional mobility enhancements.
Standards cooperation, customs facilitation, and reduced non-tariff barriers.
Post-CETA, Gujarat-based SMEs like Arvind Mills and Raymond exported cotton apparel tariff-free, improving competitiveness and margins. UK investors also found smoother collaboration in the fintech and IT sectors.
The agreement cemented India’s co-architect role in trade diplomacy, showcasing negotiating confidence and global economic relevance. Near-complete customs duty elimination and recognition of Indian standards enhanced access to high-income markets.
CETA reflects India’s ability to merge tariff liberalisation with services and mobility benefits, positioning trade as a tool for both economic and geopolitical leverage.
Trade-for-Investment Innovation: India–EFTA TEPA (2024/25)
TEPA represents India’s most ambitious FTA yet, linking preferential access to USD 100 billion in long-term FDI from Switzerland, Norway, Iceland, and Liechtenstein.
Key Features:
Phased tariff concessions.
Strong intellectual property protection, regulatory certainty, and dispute resolution.
Investment commitments in manufacturing, pharmaceuticals, clean energy, advanced engineering, and financial services.
Swiss clean-energy firm ABB is committed to long-term manufacturing in India, leveraging trade advantages to sell high-tech components globally. Simultaneously, Indian exporters gained better access to high-value, innovation-driven EFTA markets, linking trade to domestic industrial capacity.
TEPA illustrates that FTAs can be drivers of industrial transformation, not just tariff reduction, making it an approach particularly suited for advanced economy partners. It features integration into high-value supply chains, expansion of production capacity, and access to cutting-edge technology.
India’s Emerging FTA Template
India’s new FTA template is more than a series of trade deals. It is a blueprint for aligning global ambitions with domestic growth, proving that trade is no longer a response but a tool of strategic agency.
From Mauritius to EFTA, each agreement reflects deliberate intent:
Mauritius: Gateway to Africa.
UAE and Oman: Gulf scale and strategic depth.
Australia and New Zealand: Indo-Pacific supply-chain security.
UK: Post-Brexit market access.
EFTA: Investment-driven industrial growth.
This approach balances speed with precision, openness with domestic resilience, and liberalisation with targeted safeguards. As negotiations with the EU, US, Latin America, and the Eurasian Economic Union advance, India’s model promises not just new markets but a replicable framework for trade diplomacy, one that integrates strategy, trust, and industrial foresight.
In the end, India has moved from being a hesitant player to a confident strategist, turning FTAs into instruments of global agency. The country’s evolving trade diplomacy is no longer reactive; it is a calculated, high-stakes game that is played not on hope, but on design, foresight, and execution.
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