India is a member of the following two regional Free Trade Agreements (FTAs):
Agreement on South Asian Free Trade Area or SAFTA whose participating countries are Afghanistan, Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan and Sri Lanka.
India-ASEAN Comprehensive Economic Cooperation Agreement (CECA) on goods, services and investment whose participating countries are India, Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam)
The trade data with FTA partners, prior to and after implementation of the agreement indicates that there has been a significant increase of India’s trade.
Moreover, studies also indicate that increase in share of imports of raw materials, intermediate goods and capital goods could lead to enhanced efficiencies in domestic production and thus contribute to greater exports.
The overall effect on trade of an FTA is positive and statistically significant.
The free trade agreement (FTAs) do provide opportunities for export of agricultural (including processed) products of interest for macro, small and medium enterprises (MSMEs).
