India Must Leverage FTAs Better: Piyush Goyal Highlights Quality and CSR

Piyush Goyal, Union Minister for Commerce and Industry, has urged Indian businesses to fully utilise the country’s expanding network of Free Trade Agreements (FTAs), stressing that quality must remain at the core of export growth.

He highlighted that India has signed nine FTAs with 38 developed nations, enabling preferential access to nearly two-thirds of global trade. These agreements significantly reduce or eliminate tariffs, offering Indian exporters a competitive advantage in international markets.

FTAs Open New Opportunities for Key Sectors

Benefits for MSMEs and Traditional Sectors

Goyal emphasized that FTAs have created new growth avenues for multiple sectors, including:

• Micro, Small and Medium Enterprises (MSMEs)
• Farmers and agricultural producers
• Fishermen and marine exporters
• Artisans and handicraft industries

Piyush Goyal, Union Minister for Commerce and Industry,  noted that while market access has improved, success in global markets will depend on meeting stringent international quality standards.

Importance of Quality Standards

The minister underlined that adherence to global benchmarks in manufacturing, packaging, and compliance is essential to fully benefit from FTAs. Without quality assurance, Indian products may struggle to compete despite tariff advantages.

Address at CSR Event Highlights Social Responsibility

Focus on Corporate Social Responsibility

Speaking at the National CSR Announcement for FY 2026–27 and scholarship launch by Malabar Charitable Trust, Goyal praised companies that go beyond mandatory CSR obligations.

He highlighted the initiative of allocating 5 per cent of net profits towards CSR, noting that it exceeds statutory requirements and reflects a deeper commitment to social welfare.

Emphasis on Meaningful Impact

Goyal stressed that CSR initiatives should focus on real outcomes rather than future promises, encouraging organizations to deliver measurable benefits to communities.

What is CSR in India?

In India, Corporate Social Responsibility (CSR) is not just a philanthropic gesture but a statutory obligation. India was the first country in the world to make CSR mandatory for certain classes of companies through Section 135 of the Companies Act, 2013.

As of March 2026, the landscape is undergoing a significant shift due to the newly introduced Corporate Laws (Amendment) Bill, 2026, which aims to balance social impact with the "Ease of Doing Business."

1. The Legal Framework & Eligibility

Under the current laws, a company must spend at least 2% of its average net profit (made during the three immediately preceding financial years) on CSR activities if it meets any of the following criteria in the preceding financial year:

• Net Worth: ₹500 crore or more.

• Turnover: ₹1,000 crore or more.

• Net Profit: ₹5 crore or more.

Key 2026 Amendments

The Corporate Laws (Amendment) Bill, 2026, introduced in Parliament on March 23, 2026, proposes several major updates:

• Higher Threshold: The net profit eligibility is proposed to increase from ₹5 crore to ₹10 crore, exempting many smaller firms from the mandate.

• Compliance Easing: The deadline to transfer unspent CSR funds to a "Unspent CSR Account" is being extended from 30 days to 90 days.

• Decriminalization: Procedural defaults related to CSR will now attract civil penalties instead of criminal prosecution, significantly reducing the litigation burden on directors.

2. Where the Money Goes (Schedule VII)

Companies cannot spend CSR funds on just anything. The activities must fall under Schedule VII of the Act. Currently, the most funded sectors include:

• Education (34.7%): Building schools, digital literacy (especially AI literacy in 2026), and vocational training.

• Healthcare (20.5%): Maternal health, cancer care, and preventive healthcare.

• Environment (10%): A major shift has occurred from simple tree planting to large-scale ecosystem restoration, such as mangrove rejuvenation and carbon sequestration projects.

3. Spending Trends & Major Players (FY 2024-25)

CSR spending has matured into a massive economic force. In the last financial year (FY24-25), cumulative spending by Indian corporates reached approximately ₹34,909 crore.

4. Current Challenges: The Regional Gap

Despite the record spending, a major point of criticism in 2026 remains the geographical imbalance.

• Industrial Hubs: Over 40% of funds flow into just five states—Maharashtra, Gujarat, Karnataka, Tamil Nadu, and Rajasthan—because companies prefer spending near their areas of operation.

• Aspirational Districts: The 112 most underdeveloped districts in India (Aspirational Districts) still receive less than 12% of the total national CSR outlay.

5. The Evolution: CSR 2.0

In 2026, we are seeing the rise of "Strategic CSR" or CSR 2.0. This involves:

• AI for Good: Companies like Infosys and Wipro are pivoting CSR toward training rural teachers and students in AI to prevent a "digital divide" as automation increases.

• Employee-Led Selection: More firms now allow employees to vote on which NGOs receive grants, boosting internal engagement.

• Blockchain Tracking: To combat "greenwashing" and ensure transparency, large firms are increasingly using blockchain to track fund utilization in real-time.

Note: If a company fails to spend the required amount, the unspent amount must be transferred to a government-scheduled fund (like the PM National Relief Fund) within six months of the end of the financial year, unless it is for an ongoing project.

Advancing the Vision of Viksit Bharat 2047

H3: Inclusive Development at the Core

The minister reiterated the government’s commitment to inclusive growth under the vision of Viksit Bharat 2047, ensuring that all citizens have access to:

• Food security
• Housing
• Healthcare
• Education
• Electricity and clean water
• Digital connectivity

These foundational services are essential to enabling widespread participation in economic growth.

Women-Led Development as a Growth Driver

Empowering Women for National Progress

Goyal highlighted the importance of women-led development, referencing the views of B. R. Ambedkar that societies progress when women are empowered.

Under the leadership of Narendra Modi, the government has focused on improving access to education and opportunities for women, aiming to create a more inclusive workforce and society.

Lessons from the Pandemic and Need for Collective Action

Strength Through Unity

Goyal pointed to the spirit of unity demonstrated during the COVID-19 pandemic as an example of what collective effort can achieve.

He encouraged industry stakeholders, policymakers, and communities to work together to overcome global economic challenges and achieve national development goals.

Focus on Skilling and Youth Empowerment

Building a Future-Ready Workforce

The minister emphasized the importance of:

• Skill development
• Language training
• Quality education

These factors are critical to enhancing global employability for India’s youth and ensuring they can take advantage of international opportunities.

Scholarship Initiative Impact

He commended the initiative under which around 33,000 children will benefit from scholarships, stating that such programs play a vital role in expanding access to education and opportunities.

India’s Resilience Amid Global Challenges

Despite ongoing global disruptions in trade and logistics, Goyal reaffirmed that India remains committed to strengthening its global economic engagement. He noted that the country continues to pursue strategic partnerships and trade agreements to enhance its position in the global economy.

Conclusion

Piyush Goyal’s address underscores a multi-dimensional approach to India’s growth—leveraging FTAs for export expansion, maintaining a strong focus on quality, and promoting inclusive development through CSR and social initiatives.

By encouraging industry to align with global standards and invest in community development, the government aims to create a robust and sustainable growth model.

As India moves towards its ambitious Viksit Bharat 2047 vision, collaboration between industry, government, and society will be key to unlocking its full economic potential and ensuring equitable progress for all.