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19 Feb 2026·Source: The Hindu
4 min
EconomyInternational RelationsNEWS

Goyal: FTA Benefits Contingent on Private Sector Approval

Commerce Minister Goyal emphasizes private sector approval for FTA concessions.

Commerce Minister Piyush Goyal asserted that he has not finalized any trade deal where India provided concessions without the approval of the relevant private sector. Since about 2022, Mr. Goyal has overseen the conclusion of eight trade agreements, with a ninth currently underway with the U.S.

Speaking at the Global Economic Cooperation 2026 summit, Mr. Goyal stated that over the last four years, India has entered into agreements from a position of strength, allowing it to secure the interests of the country’s farmers, fisherfolk, and micro, small and medium enterprises (MSMEs). He emphasized that India has not opened up its dairy sector “for any country whatsoever”.

Key Facts

1.

Commerce Minister Piyush Goyal has overseen eight trade agreements since about 2022.

2.

A ninth trade agreement with the U.S. is currently underway.

3.

India has not opened up its dairy sector for any country.

4.

India enters into agreements from a position of strength, securing interests of farmers, fisherfolk, and MSMEs.

UPSC Exam Angles

1.

GS Paper 3 (Economy): Trade agreements and their impact on the Indian economy.

2.

Connects to the syllabus section on international trade, investment models, and economic development.

3.

Potential question types: Statement-based MCQs, analytical questions on the impact of FTAs.

In Simple Words

Basically, when India makes deals to trade with other countries, the government makes sure businesses here are okay with it first. This way, the deals help Indian businesses instead of hurting them. It's like getting everyone's permission before making a big decision.

India Angle

This affects Indian shopkeepers, farmers, and factory owners because these trade deals can change how easy it is to sell their goods abroad. If the deal is good, they can sell more and earn more. If it's bad, they might struggle to compete.

For Instance

Think of it like your local farmers' market. Before the organizers let in a big supermarket chain, they'd ask the farmers if they're okay with the competition. This ensures the farmers don't get pushed out.

It matters because these trade deals can affect the prices you pay for things, the jobs available, and the overall economy. Making sure Indian businesses are on board helps protect our local economy.

No trade deal goes through unless Indian businesses give it the thumbs up.

Visual Insights

Key Highlights from Goyal's Address

Highlights key points from Commerce Minister Piyush Goyal's address regarding trade agreements and private sector approval.

Trade Agreements Concluded Since 2022
8

Highlights India's active engagement in trade negotiations.

Trade Agreement Underway
1

Current FTA negotiation with the U.S.

More Information

Background

Free Trade Agreements (FTAs) are arrangements between two or more countries where they agree to reduce or eliminate customs tariff and non-tariff barriers to trade. India has been actively pursuing FTAs to boost its exports and integrate further into the global economy. The rationale behind FTAs is to gain preferential access to markets, reduce trade costs, and enhance economic cooperation. India's approach to FTAs has evolved over time. Initially, India focused on agreements with developing countries, but it has since expanded its scope to include developed economies. Key milestones include the India-Sri Lanka FTA in 2000, which was India's first FTA, and subsequent agreements with ASEAN, South Korea, and Japan. These agreements have aimed to increase trade volumes and investment flows. The negotiation and implementation of FTAs involve various stakeholders, including government agencies, industry representatives, and civil society organizations. The Department of Commerce plays a crucial role in formulating trade policy and conducting negotiations. The process typically involves consultations with domestic industries to assess the potential impact of tariff reductions and other concessions. This ensures that the interests of domestic producers are taken into account during negotiations.

Latest Developments

In recent years, India has shown a renewed focus on FTAs, particularly with countries like Australia and the UAE. The India-Australia Economic Cooperation and Trade Agreement (ECTA), which came into effect in December 2022, is expected to significantly boost bilateral trade. Similarly, the India-UAE Comprehensive Economic Partnership Agreement (CEPA), implemented in May 2022, aims to enhance economic ties between the two nations. Looking ahead, India is actively engaged in FTA negotiations with several other countries and regions, including the United Kingdom and the European Union. These negotiations are aimed at securing favorable terms for Indian exporters and attracting foreign investment. The government is also focusing on addressing non-tariff barriers and ensuring that FTAs are aligned with India's broader economic objectives. Furthermore, there is increasing emphasis on reviewing existing FTAs to assess their impact and identify areas for improvement. This includes evaluating the utilization rates of preferential tariffs and addressing any implementation challenges faced by businesses. The goal is to ensure that FTAs are effective in promoting trade and investment and contribute to India's economic growth.

Practice Questions (MCQs)

1. With reference to India's Free Trade Agreements (FTAs), consider the following statements: 1. Commerce Minister Piyush Goyal has stated that no trade deal has been finalized without private sector approval. 2. India has not opened up its dairy sector for any country under any FTA. 3. As of 2024, India has concluded eight trade agreements since 2022, with a ninth underway with the U.S. Which of the statements given above is/are correct?

  • A.1 and 2 only
  • B.2 and 3 only
  • C.1 and 3 only
  • D.1, 2 and 3
Show Answer

Answer: D

All three statements are correct based on the provided summary. Statement 1 is correct as the Commerce Minister affirmed that no trade deal was finalized without private sector approval. Statement 2 is correct as India has not opened its dairy sector for any country. Statement 3 is also correct as India has concluded eight trade agreements since 2022, with a ninth underway with the U.S.

2. Which of the following statements accurately reflects India's current stance on Free Trade Agreements (FTAs)?

  • A.India is primarily focused on multilateral trade agreements through the WTO.
  • B.India is prioritizing bilateral FTAs with developed economies while protecting the interests of its farmers and MSMEs.
  • C.India has completely liberalized its agricultural sector under all FTAs.
  • D.India is only pursuing FTAs with developing countries in the South Asian region.
Show Answer

Answer: B

Option B accurately reflects India's current stance. The summary indicates that India is entering into agreements from a position of strength, securing the interests of farmers, fisherfolk, and MSMEs. India has been actively pursuing bilateral FTAs with developed economies. The other options are incorrect as India is not solely focused on multilateral agreements, has not liberalized its agricultural sector, and is not only pursuing FTAs with developing countries.

3. Assertion (A): India's Commerce Minister has emphasized the importance of private sector approval in finalizing Free Trade Agreements (FTAs). Reason (R): Private sector involvement ensures that the interests of domestic industries, particularly MSMEs, are adequately protected during trade negotiations. In the context of the above statements, which of the following is correct?

  • A.Both A and R are true, and R is the correct explanation of A.
  • B.Both A and R are true, but R is not the correct explanation of A.
  • C.A is true, but R is false.
  • D.A is false, but R is true.
Show Answer

Answer: A

Both the assertion and the reason are true, and the reason correctly explains the assertion. The Commerce Minister's emphasis on private sector approval is directly linked to ensuring that the interests of domestic industries, including MSMEs, are protected during trade negotiations. This involvement helps in securing favorable terms and preventing potential harm to these sectors.

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