The free trade agreement (FTA) with the European Union (EU) and the US deal will now place export prospects on a higher trajectory, as they are our largest export destinations. Two points must be kept in mind. The first is that exporters in industries such as textiles, chemicals, leather products, marine products, and gems and jewellery would be at an advantage as these markets offer more opportunities. India will have an edge over rivals like Bangladesh and Vietnam that have a slightly higher tariff. Secondly, imports too will increase and pose competition to the domestic industry. The details thus become important because FTAs in general offer reciprocal benefits for both sides.

The US deal generates additional interest, considering President Trump has spoken about India buying oil not from Russia but from the US and Venezuela. Indian refiners need clarity because apart from Russian oil costing lower, freight costs would be higher for other alternatives. Further, since imports cannot be reduced to nil in a month but only gradually, the phasing of reduction would be pertinent.

The EU deal also demands close scrutiny as non-tariff barriers can remain a concern although tariffs have been lowered for over 95% of exported goods. For instance, the West is known to enforce rules such as phytosanitary conditions to block farm product imports from emerging markets. Similarly, environmental issues come in with certification requirements. Subjects such as carbon emissions therefore become important. The list gets longer when labour conditions are scrutinized.