Union Commerce Minister Piyush Goyal on Thursday said he expects at least two more free trade agreements to be signed in 2023.
Negotiations are scheduled with the U.K., European Union and Canada, Goyal said at an event here, adding that his ministry does not have the bandwidth to tend to requests by smaller trading partners like New Zealand with which the bilateral trade stands at $350 million.
“India today works from a position of strength, we negotiate with confidence,” Goyal said, adding that the country will sign at least two such free trade agreements.
Speaking at the event to mark the operationalisation of the India-Australia Economic Cooperation and Trade Agreement signed in April this year, Goyal said January itself is filled with meetings between Indian Commerce Ministry officials and their counterparts abroad.
After handing over certificates of origin to the first among the Indian goods being sent to Australia after the agreement, Goyal said the FTA will benefit a slew of sectors, including textiles, gems and jewellery and also information technology, which gets aided by the dropping of double taxation.
Goyal said he expects Indian IT companies’ billing to Australia alone growing to $1 billion in the next 5-7 years from $200 million at present.
The Regional Comprehensive Economic Partnership, which India walked out of in 2019, would have become a free trade agreement with China in effect, Goyal said. Indian industry was “petrified” with the earlier UPA government’s move to start negotiations on the same, he said.
He called the walkout an economically prudent and wise decision. As of now, with the agreement with Australia, India has separately struck trade agreements with 13 of the 15 countries in the RCEP, while only New Zealand and China remain.
He said on a conservative basis, the ministry expects the bilateral trade between India and Australia to increase to $31 billion in five years with the free trade agreement in place.
The agreement is a win-win document that has the complementarities as its fundamental building block, Goyal said, adding that India will get access to cheaper raw materials like coal from Australia while the finished Indian goods will have a market there.
With the new government in Australia ratifying the agreement, 98% of the Indian exports by value will enter the country sans any duties, Goyal said.
When asked about the critique of former chief economic advisor Arvind Subramanian about the tariffs hurting the government’s production-linked incentive scheme, the country’s inward-looking attitudes on trade and the disservice done to Indian enterprise by the government’s urge to create “national champions” in the industry by promoting specific groupings, Goyal said the former CEA wants India to open up at a go while the government is in favour of adopting a calibrated approach.
“We believe that it is important that we calibrate the opening up so that Indian industry gets enough time to mature, develop themselves and be able to compete on fair terms,” Goyal said. PTI