GTRI Urges India to Focus on Export Gains From Existing FTAs
GTRI noted that India is entering 2026 amid one of the toughest global trade environments in recent years
New Delhi: With 18 free trade agreements (FTAs) already signed and more likely in 2026, India must shift its focus from negotiating new deals to ensuring that existing FTAs translate into tangible export gains, especially in sectors such as electronics, engineering and textiles, according to a report by the Global Trade Research Initiative (GTRI).
The report said India’s total exports stood at USD 825 billion in FY25 and are projected to rise only marginally to around USD 850 billion in FY26, reflecting a difficult global trade environment. Merchandise exports are expected to remain flat due to weak global demand and rising protectionism, while services exports may cross USD 400 billion, providing the main support to overall trade performance.
“With 18 FTAs already signed and more possible in 2026, India’s priority must shift from signing deals to making FTAs deliver real export gains,” the report stated.
GTRI noted that India is entering 2026 amid one of the toughest global trade environments in recent years. Rising protectionism in advanced economies, slowing global demand and new climate-linked trade barriers are converging at a time when India is trying to scale up exports, making it more a challenge of holding ground than expanding.
The United States has emerged as a major pressure point. Under President Donald Trump, the U.S. has moved away from World Trade Organization norms in favour of high unilateral tariffs. India’s exports to the U.S. declined by about 21 per cent between May and November 2025 under the current 50 per cent tariff regime.
GTRI warned that unless Washington rolls back the additional 25 per cent penalty tariff linked to India’s Russian oil purchases or concludes a trade agreement, exports to India’s largest market could weaken further.
Europe poses a different challenge. The European Union is set to implement its Carbon Border Adjustment Mechanism (CBAM) from January 1, 2026, effectively imposing a carbon tax on imports. Even ahead of payments, compliance and reporting requirements have already reduced India’s steel exports to the EU by about 24 per cent.
Despite these challenges, the report pointed to signs of resilience. While exports to the U.S. fell, India’s exports to the rest of the world rose by around 5.5 per cent, indicating gradual diversification of markets.
With limited control over global geopolitical developments, GTRI said India’s strategy for 2026 must focus inward. Export growth will depend on improving product quality, moving up the value chain and reducing costs. “In 2026, India’s trade performance will be decided less by external opportunities and more by domestic execution,” the report concluded.
