Senior officials from India and the Eurasian Economic Union (EEU) recently engaged in discussions aimed at initiating negotiations for a free trade agreement (FTA).
The Union comprises of five nations; Armenia, Belarus, Kazakhstan, Kyrgyzstan and Russia. Among these, Russia is the top trading partner of India in the bloc, with bilateral trade worth USD 49.4 Billion in FY23.
According to an official statement, the discussions, held last month, revolved around the formal commencement of negotiations for the proposed FTA. Notably, two feasibility studies have already been conducted to assess the viability and potential impact of such an agreement.
Free trade agreements typically involve the elimination or substantial reduction of customs duties on a wide range of traded goods between participating countries.
For India, such agreements offer enhanced market access for its goods and services, providing a competitive edge for domestic exporters across various sectors, including engineering goods, electronics, and agriculture.
India's exports to Russia totaled USD 1.14 billion during FY23, while imports stood significantly higher at USD 46.2 billion, largely driven by increased crude oil imports.
In the fiscal year 2022-23, trade volumes stood at USD 134.26 million with Armenia, USD 111.81 million with Belarus, USD 641.62 million with Kazakhstan, and USD 56.56 million with Kyrgyzstan.
This move towards an FTA with the EEU parallels similar agreements signed by India with other trading blocs. India inked a comparable agreement with the European Free Trade Association (EFTA), whose members include Iceland, Liechtenstein, Norway, and Switzerland.
As negotiations progress, stakeholders remain optimistic about the prospects of deeper economic integration between India and the EEU, foreseeing mutually beneficial outcomes for both regions.
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