Assess India's FTA strategy in the context of rising US tariffs.

India's trade diplomacy has shifted from caution to speed as 100% US tariffs loom and a bilateral deal remains elusive [3]. The strategy — a mix of mega-pacts and quick, smaller agreements — is directionally sound, but its payoff rests on utilisation, not signatures.

Strengths of the current approach

• Spread: India now has nine FTAs covering 38 countries, including the UK CETA (July 2025), EFTA TEPA (in force 1 October 2025) and the India–EU FTA announced in January 2026 [2].
• Speed as insurance: the India–New Zealand FTA, concluded in about nine months and entering into force on 20 October 2026, secures duty-free access for 100% of Indian exports [1].
• MSME cushion: exporters — nearly half of them MSMEs — gain alternative markets when tariffs rise or trade routes close; textiles (~14%) and gems (~5%) lead India's exports to New Zealand [3].
• Defensive lines held: India conceded only 70.03% of tariff lines (≈95% of bilateral trade value), excluding dairy, onions, sugar and edible oils — protecting smallholder agriculture [4].

Limitations

• Scale mismatch: New Zealand trade is about $1.1 billion, under 1% of India's goods trade; even doubling it by 2030 cannot offset the US market [3].
• The utilisation gap: only about 25% of eligible Indian exports claim FTA preferences, against 70–80% in developed economies, because rules-of-origin paperwork often costs more than the duty saved [5].
• Bandwidth: negotiating capacity spent on small pacts competes with the decisive EU and US tracks [2].

Way forward

• Digital, low-cost certificates of origin and trust-first self-declaration, as adopted under the UK CETA [5].
• Publish product-wise duty-gain and origin-rule guides before entry into force, and report annual utilisation per FTA [5].

India's FTA strategy is a credible hedge against tariff shocks, diversifying markets while shielding sensitive sectors. Its promise will be realised only when small exporters can actually claim the preferences won — converting agreements signed into markets served.