Trade policy experts emphasize that high compliance costs and complex documentation deter Indian exporters.

A newly released Global Trade Research Initiative (GTRI) report reveals that India leverages its Free Trade Agreements (FTAs) at a dismal 20-30% rate. In stark contrast, partner nations exploit these trade pacts at a high 60-70%, heavily disadvantaging domestic Indian industries.

Trade policy experts emphasize that high compliance costs and complex documentation deter Indian exporters. They also point out that many partner nations already maintain very low standard tariffs, rendering preferential FTA rates practically redundant for domestic Indian businesses, which actively prevents them from competing globally.

Consequently, this trade imbalance has caused a massive economic impact, resulting in an average annual trade deficit of nearly USD 62 billion over the last three years with ASEAN, Japan, and South Korea alone as cheap foreign imports flood India. This trend severely threatens long-term national industrial growth.

The core root cause of this ongoing crisis is a severely inverted duty structure further exacerbated by FTAs. For instance, raw materials like steel face 7.5-10% tariffs, while finished machinery manufactured from them enters India at absolute zero duty, penalizing local production lines heavily.

Navigating forward, vital local manufacturing can only thrive if policy shifts from passive signing to active safeguarding. Revamping the duty framework alongside aggressive digital compliance tracking will finally turn these lopsided trade deals into a winning formula for India, completely ensuring fair market competition across all sectors.