India’s Free Trade Agreements

Issue: Mar-Apr 2021 This paper reviews India’s experience with the free trade agreements (FTAs) that it signed over the last two decades. The trade outcomes under the agreements are found to be quite modest: The trade shares of India’s FTA partners stayed nearly constant over the past decade, and trade deficits with FTA partners, as a share of the overall deficit,  did not increase over time. These findings challenge the assertion that India’s trade agreements have led to a widening of trade deficits and that they were responsible for the stagnation of the Indian manufacturing sector.