India’s recent rush to sign trade pacts reflects a broader effort to use commerce as a tool of strategy, but the results so far suggest the gains are more uneven than the political language implies. Over the last few years, New Delhi has concluded agreements with the United Arab Emirates, Australia, Oman, the United Kingdom and New Zealand, while also pushing ahead with talks involving the European Union, the United States, Gulf states and Canada. That expanding network has been presented as proof that bilateral trade deals can open markets, deepen supply chains and strengthen India’s global position.
Yet India’s experience with several Asian partners shows why the celebratory narrative deserves scrutiny. Trade with ASEAN, South Korea, Japan and Singapore has increasingly tilted toward imports, widening deficits rather than narrowing them. The Hindu’s data indicates that India’s trade gap with ASEAN rose from $10.4 billion in 2012 to $51.2 billion in 2025, as imports climbed much faster than exports. A similar pattern has been seen with Japan and South Korea, while trade with Singapore has shifted from surplus to deficit after the agreement took effect.
That record matters because it challenges a common assumption behind the current FTA strategy: that more agreements automatically translate into more exports and stronger participation in global value chains. In practice, market access on paper has often coincided with stronger import competition, especially where domestic industry has not been able to respond with enough speed or scale. The result is a growing debate among policymakers and trade analysts over whether bilateralism is truly delivering the industrial upgrade it promises, or merely locking in asymmetrical trade relationships.
The newer agreements may yet produce more balanced outcomes. The British government’s impact assessment says the India-UK pact could significantly expand trade, while S&P Global has said the deal, concluded in May 2025, would cut tariffs on most Indian import lines from the UK and could help double bilateral trade by 2030. A separate study on a possible India-US agreement argues that both countries could benefit, with India gaining in textiles and apparel. But those projected upside cases also underline the central issue raised by India’s recent record: free trade deals can support growth, yet their outcomes depend heavily on domestic competitiveness, sectoral readiness and the terms negotiated.
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