Bilateral preferential trade deals are increasingly replacing WTO-led multilateralism. Discuss the opportunities and risks for India.

The WTO Appellate Body has not functioned since 2019 and the Doha Round has stalled. More and more trade rules are now being written bilaterally. The February 2026 India–U.S. interim framework set an 18% reciprocal tariff on listed Indian goods [2]. It shows India now bargains for a relative edge over rivals rather than for multilateral concessions. This shift brings real gains but also serious risks.

Opportunities for India

• Edge over rival exporters: the U.S. has assured India a tariff advantage over competitor countries once it finalises its tariff structure [1]. This matters most for labour-intensive exports that compete with Vietnam and Bangladesh.
• Supply-chain realignment: preferential access makes India a natural China+1 base. It adds to India's new FTAs with the UAE, Australia, EFTA and the UK.
• Choosing what to open: a bilateral deal lets India shield sensitive sectors. Dairy, cereals, poultry and GM food were kept out [3], a freedom that WTO "single undertaking" rounds (where nothing is agreed until everything is agreed) rarely allow.
• Speed: deals take months to conclude, while the Doha Round has run for decades.

Risks for India

• Uneven concessions: India will cut tariffs on all U.S. industrial goods and intends to buy USD 500 billion of U.S. goods over five years [2]. U.S. relief covers only listed goods.
• The edge can disappear: India's advantage is only relative. It vanishes if the U.S. later gives rivals lower rates. Other U.S. trade tools also stay in use: the USTR added a 10% Section 301 duty on Indian imports in July 2026 [4].
• WTO-consistency: GATT Article XXIV allows such deals only if they cover "substantially all the trade", which means "considerably more than merely some" [5]. Broad farm exclusions leave an interim deal open to challenge.
• Loss of the MFN shield: developing countries gain most from non-discriminatory rules. Bilateral deals favour the bigger power, and issues like food-security stockholding can only be settled at the WTO.
• Transparency: the executive negotiates the terms and the details are not public [1]. This limits scrutiny by Parliament and by stakeholders such as farmers.

Bilateralism is a pragmatic hedge, not a replacement for the multilateral system. India should write a fixed tariff gap into the treaty text and keep quantity caps on sensitive farm goods. It should also publish a timetable to a full trade agreement so the deal can be defended under Article XXIV. Alongside this, India should keep pushing to restore the Appellate Body and reform the WTO. This dual track supports SDG 17 and a rules-based trade order.