India should now focus on FTA implementation: Experts

India’s next priority on the Free Trade Agreement (FTA) front should be practical implementation and helping exporters use these pacts, as the gap between the negotiated and used market access remains the country’s weakest link, experts say.

They said that historically, India’s FTA utilisation has hovered around 25 per cent, compared with 70-80 per cent in developed economies, and closing this gap is now the single highest-leverage trade policy reform available.

The immediate priority should be to ensure that these negotiated benefits translate into actual claims at the border, they added.

“Hence, India’s next FTA priority should be practical implementation, helping exporters use the agreements, defend against new trade barriers, and convert market access into sustained export growth,” Gulzar Didwania, Partner, Deloitte India, said.

India has so far implemented several trade pacts, including those with Singapore, Japan, Korea, the UAE, Australia, ASEAN, and the EFTA bloc. It has also finalised such pacts with Oman, New Zealand, the European Union, and the UK.

The immediate priority should now be to ensure that these negotiated benefits translate into actual claims at the border, Didwania said.

“The policy narrative must now move decisively from FTA signing to FTA utilisation. India has already secured significant market-access outcomes, including duty-free access for 99 per cent of India’s exports to the UK under CETA and market access for more than 99 per cent of India’s exports by trade value under the India-EU FTA,” he added.

Didwania also said that FTAs can help cushion the impact of geopolitical uncertainties on India’s merchandise exports by creating alternative trade routes and improving access to multiple strategic markets. India’s best approach would be to diversify export markets and products, deepen integration with global value chains, and strengthen domestic manufacturing competitiveness to reduce external vulnerabilities, he said.

Rudra Kumar Pandey, Partner, Shardul Amarchand Mangaldas & Co, also stated that the most immediate priority is FTA utilisation.

“The gap between market access negotiated and market access used remains India’s weakest link,” he said, adding that utilisation rates under the Australia ECTA have reached 84 per cent.

But awareness among MSMEs remains low, and certification infrastructure is underdeveloped across most other agreements. “Every firm with export potential must understand the preferential access available to it and have the documentation and compliance support to use it,” Pandey said.

He added that the sectors where India has negotiated the deepest tariff concessions - textiles, leather, engineering goods, pharmaceuticals, and marine products - need targeted PLI-type support to build the production capacity and quality standards required to exploit that access fully.

India must also accelerate standards alignment and regulatory upgradation to meet the compliance requirements of partner markets, Pandey said.

This includes developing credible domestic certification systems, pursuing mutual recognition agreements that allow Indian testing and conformity assessment to be accepted abroad, and building the carbon accounting frameworks that the European market access will increasingly require.

“The firms that will benefit most from FTAs are those that can meet partner-country quality, traceability, and sustainability standards. Government support through technical assistance and soft financing for MSMEs to achieve these standards is essential,” he said.

Further, he said that India’s export landscape is shifting toward higher-value manufacturing.

Electronics has risen from 3.3 per cent to 7.9 per cent of the export basket over the last decade, machinery from 3.8 per cent to 6.9 per cent, and smartphones are now India’s top exported commodity. But this shift carries structural vulnerabilities that grow as India moves up the value chain.