India is pursuing perhaps its most ambitious free trade agenda in decades. In recent years, it has concluded comprehensive trade agreements with the UAE, Australia, the EFTA countries and, most recently, the United Kingdom. Negotiations with the European Union and several other partners are gathering momentum. Collectively, these agreements represent one of the most significant shifts in India's trade strategy since economic liberalisation.
The agreements have rightly been welcomed. In an increasingly fragmented global economy, countries are diversifying supply chains, reducing strategic vulnerabilities and searching for dependable economic partners. India, with its expanding domestic market, demographic advantage and growing manufacturing capabilities, is well placed to benefit from this realignment. Deeper integration with trusted partners is no longer simply a trade objective. It has become an economic and strategic necessity.
Yet amid the understandable optimism surrounding every new agreement, an important question deserves greater attention. How should we judge the success of India's new FTAs?
The instinctive answer is to look at tariffs eliminated, markets opened, exports projected or investment promised. These are important metrics and deserve careful scrutiny. But they cannot be the only measures of success. Trade agreements are not ends in themselves. They are instruments for achieving broader economic outcomes. History offers a useful reminder.
India's earlier experience with FTAs has produced neither unqualified success nor outright disappointment. Agreements with ASEAN, Japan and the Republic of Korea generated significant opportunities for several sectors while exposing weaknesses in others. Some industries expanded exports and became more globally competitive. Others struggled against rising imports. The same agreement often produced different outcomes across different sectors of the economy.
The lesson is not that FTAs succeed or fail. The lesson is that they do not determine outcomes on their own. An FTA opens doors. It does not guarantee that businesses will walk through them.
Whether improved market access translates into higher exports, larger investments, better jobs and rising incomes depends on an entirely different set of policies. Education and skills. Infrastructure and logistics. Innovation and research. Access to finance. Efficient regulation. Competitive manufacturing. These are the foundations upon which trade agreements either succeed or disappoint.
Trade policy creates opportunities. Domestic policy converts those opportunities into economic gains.
This distinction often receives less attention than it deserves. Public debate understandably focuses on negotiations, concessions and market access. Yet the harder work begins after the agreement has been signed. Businesses must become more competitive. Workers require new skills. Logistics must improve. Small and medium enterprises need support to integrate into global value chains. Without these complementary reforms, even the most ambitious trade agreement cannot deliver its full potential.
Ultimately, the real test of any FTA lies not in the text of the agreement but in its impact on people's lives. Does it encourage firms to invest and expand? Does it create productive employment for the millions entering India's labour force each year? Does it help Indian manufacturers become more competitive internationally? Does it stimulate innovation and entrepreneurship? Does it contribute to higher incomes and better living standards?
For most citizens, the legal architecture of trade agreements remains understandably distant. Rules of origin, tariff schedules and customs procedures rarely enter everyday conversations. People assess economic policy differently. They judge it by the opportunities they experience. Is it becoming easier to find a good job? Can businesses grow with greater confidence? Are new industries emerging? Is the next generation likely to enjoy greater prosperity than the last?
These are not simply questions about trade. They are the ultimate measures of economic policy itself. There was a time when trade policy was discussed primarily among governments, economists and industry associations. Today, its consequences are felt much more directly. A young graduate searching for employment, a small entrepreneur seeking export opportunities, a manufacturer investing in new capacity or a parent hoping for better prospects for their children all have a stake in whether India's trade strategy succeeds.
That is why every major economic policy eventually leaves the negotiating table and enters the lives of citizens. Some policies succeed quietly because people experience their benefits without noticing the policy that made them possible. Others invite greater scrutiny because expectations rise faster than outcomes. Both are natural in a vibrant democracy.
India's expanding network of FTAs should therefore be seen not as the culmination of economic policy but as the beginning of a much larger national effort. Their success will depend not only on what has been negotiated abroad but equally on what is built at home—in classrooms and skill centres, factories and logistics parks, laboratories and research institutions, start-ups and small enterprises.
Trade agreements can open markets. They can create opportunities. They can strengthen India's place in the global economy. But only sustained domestic reform can translate those opportunities into lasting prosperity. That is the real test of India's new free trade agreements. It is a test that will ultimately be measured not by the number of agreements India signs, but by the opportunities they create for its people.
Shishir Priyadarshi | President, Chintan Research Foundation & former Director, WTO
(Views are personal)
