India’s ongoing free trade agreement negotiations could expand preferential market access to 74.5% of merchandise exports, creating new opportunities for domestic exporters across international markets.
India's expanding network of Free Trade Agreements (FTAs) could significantly improve market access for domestic exporters. According to Commerce Department data, nearly three-fourths of the country's annual merchandise exports could receive preferential market access if all the trade agreements currently under negotiation are successfully concluded.
The potential coverage could increase to 74.5% of India's FY26 merchandise exports, amounting to approximately ₹29.07 lakh crore (US$329 billion). This would represent a substantial increase from the existing coverage of 27.4%.
The government is pursuing multiple trade negotiations to strengthen India's international trade relationships, diversify export destinations and improve opportunities for domestic businesses.
According to Commerce Department data, India's preferential market access through existing and proposed free trade agreements could expand considerably.
Currently, trade agreements in force cover merchandise exports worth ₹10.68 lakh crore (US$120.9 billion), accounting for 27.4% of the country's total merchandise exports in FY26.
However, if all ongoing FTA negotiations are successfully completed, the coverage could reach 74.5%, equivalent to ₹29.07 lakh crore (US$329 billion) in exports.
This expansion would allow Indian exporters to access a much larger share of international markets under preferential trade arrangements.
India has concluded eight trade agreements over the past six years as part of its broader strategy to strengthen international economic partnerships.
In addition to these agreements, the country is negotiating more than 10 other FTAs with different trading partners. During FY27, India implemented three trade agreements involving Oman, the United Kingdom (UK) and New Zealand.
These agreements are expected to further strengthen India's commercial relationships and provide domestic businesses with additional opportunities to reach international customers.
The government is also focusing on building trade partnerships with diverse economies to reduce dependence on a limited number of export destinations.
The existing trade agreements already provide preferential market access to a significant portion of India's merchandise exports.
According to the available FY26 figures, India's total merchandise exports stood at ₹39.02 lakh crore (US$441.5 billion). The current FTA coverage accounts for ₹10.68 lakh crore (US$120.9 billion), representing 27.4% of total exports.
Here is a comparison of the existing and potential coverage:
|
Particulars |
Value |
|---|---|
|
Total merchandise exports (FY26) |
₹39.02 lakh crore |
|
Existing FTA coverage |
₹10.68 lakh crore |
|
Current coverage percentage |
27.4% |
|
Potential FTA coverage |
₹29.07 lakh crore |
|
Potential coverage percentage |
74.5% |
The proposed expansion would substantially increase the share of Indian exports eligible for preferential market access.
The expansion of India's FTA network could provide several advantages to domestic businesses and exporters.
Trade agreements can provide preferential market access, helping Indian exporters compete more effectively in partner countries.
Reduced or preferential customs duties under trade agreements can make Indian products more competitive in overseas markets.
New trade partnerships could help Indian businesses explore additional markets and reduce their dependence on traditional export destinations.
FTAs can strengthen economic cooperation, encourage business relationships and create opportunities for trade expansion across different industries.
India's ongoing FTA negotiations reflect its broader ambition to strengthen its position in international trade.
By expanding partnerships across different regions, the government aims to create more opportunities for domestic manufacturers, exporters and businesses.
The potential increase in preferential market access to 74.5% of merchandise exports highlights the importance of these negotiations for India's export growth strategy.
However, the projected coverage will depend on the successful conclusion and implementation of the trade agreements currently under discussion.
Conclusion
India's expanding FTA pipeline could significantly strengthen its global trade position, with preferential market access potentially covering 74.5% of FY26 merchandise exports worth ₹29.07 lakh crore. With more than 10 trade agreements under negotiation and new partnerships being implemented, India is seeking to diversify export destinations, improve competitiveness and create wider international opportunities for domestic businesses.