RESTRICTED
WT/TPR/G/313
28 April 2015
(15-2283)  Page: 1/19
Trade Policy Review Body  Original: English
 
TRADE POLICY REVIEW 
REPORT BY 
INDIA 
Pursuant to the Agreement Establishing the Trade Policy Review Mechanism (Annex 3 of the 
Marrakesh Agreement Establishing the World Trade Or ganization), the policy statement by India is 
attached. 
 
 
Note: This report is subject to restricted circulation and press embargo until the end of the 
first session of the meeting of the Trade Policy Review Body on India. WT/TPR/G/313 • India 
 
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  Contents 
1   INTROD UCTION  .......................................................................................................... 4  
2   ECONOMIC ENVIRONMENT .......................................................................................... 4  
2.1   Recent Growth Record ................................................................................................ 4  
2.2   Savings an d Investme nt ............................................................................................. 5  
2.3   Inflation ............................................................................................................... .... 5  
2.4   Exports, Import s and Trade Balance ............................................................................. 5  
2.4.1   Merchand ise exports ............................................................................................... 6  
2.4.2   Merchand ise imports ............................................................................................... 6  
2.4.3   Trad e Balance ........................................................................................................ 7 
2.4.4   Direction of Merchandise Trade ................................................................................. 7  
2.4.5   Services Trade ....................................................................................................... 8 
2.5   Foreign Investment .................................................................................................... 9  
2.5.1   Foreign Direct Investment (FDI) an d Foreign Institutional Investment (FII) ..................... 9  
2.5.2   Outward Inve stment by India ................................................................................... 9  
2.6   Major Challenges ....................................................................................................... 9 
2.6.1   Agriculture an d Food Secu rity ................................................................................... 9  
2.6.2   The Manufacturing Challenge ................................................................................... 10 
2.6.3   Infrastruc ture Development..................................................................................... 10 
2.6.4   Increasing demand on public investment and the need for fiscal discipline ...................... 11 
3   THE NEW REFO RM AGENDA ....................................................................................... 11  
3.1   Ease of Doing Business .............................................................................................. 11 
3.2   Make in India ...........................................................................................................  12 
3.3   Reforms in  FDI policy ................................................................................................ 12 
3.4   Introduction of Goods and Serv ices Tax ....................................................................... 12 
3.5   Skill development ..................................................................................................... 12 
3.6   Labour-sector reforms ............................................................................................... 13 
3.7   Fostering Inclusive Growth ......................................................................................... 13 
3.8   Rationalizing Subsidies .............................................................................................. 13 
4   TRADE POLICY .......................................................................................................... 13  
4.1   Foreign Trade Policy .................................................................................................. 13 
4.2   Trade Facili tation Me asures ........................................................................................ 14 
4.3   Trade Policy Challenges ............................................................................................. 15 
5   INDIA AN D THE WTO ................................................................................................ 15  
5.1   WTO Negotiations ..................................................................................................... 15 
5.2   Duty Free Quota Free (DFQF)  Access ........................................................................... 17 
5.3   LDCs Services Waiver ................................................................................................ 17 
6   REGIONAL AND BILA TERAL ARRANGEMENTS ............................................................ 17  
6.1   South As ia Regi on .................................................................................................... 18 
6.2   South East and East Asia ........................................................................................... 18 WT/TPR/G/313 • India 
 
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  6.3   Australia and New Zealand ......................................................................................... 18 
6.4   Americas ................................................................................................................ . 18 
6.5   Europe .................................................................................................................... 18 
6.6   Middle East  and Africa ............................................................................................... 18 
6.7   Other Agreements  and Negoti ations ............................................................................ 18 
7   CONC LUSION............................................................................................................. 19  
 
 WT/TPR/G/313 • India 
 
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  1  INTRODUCTION 
1.1.  The Sixth Trade Policy Review of India is taking place at a time when the prognosis for India's 
growth prospects is robustly optimistic as reflected in various forecasts. Several significant steps have been taken to re-energise the economy and th ere is a strong focus on accelerating growth, 
enhancing investment and passing on the benefit of the growth process to the common man.  
1.2.  The Government's emphasis is on developing infrastructure, creating a roadmap for reforms, 
promoting ease of doing business, ramping up investment, rationalizing subsidies, creating a 
competitive, predictable, and clean tax policy environment, and accelerating disinvestment. 
Coupled with large outlays on the social sectors to  provide a safety net, these measures will have 
a significant impact on boosting demand and generating investment. This, in turn, will spur growth in trade, industry and exports.   
1.3.  Foreign trade today has begun to play a significant part in India's economic development. 
India's two-way merchandise trade crossed US$760 billion in 2013-14 or 44.1% of the GDP. If services trade is added, India's trade reached nearly US$1 trillion. This has been achieved despite 
the global contraction and is indicative of India's resilience and increasing integration with the 
global economy. During the four-year period und er review (2010-11 to 2013-14), exports grew at 
a compound annual growth rate of 8.0%, while imports grew by 6.8%. 
1.4.  Reports present a mixed picture on the exte rnal environment. According to the IMF, global 
growth will receive a boost from lower oil prices – a result mainly of higher supply – but while the recovery in the United States was stronger th an expected, economic performance in all other 
major economies, particularly Japan, fell short of  expectations. The euro area growth projections 
are weaker. Slower growth in China and the recovery  in the US will have significant repercussions 
on India's trade. 
2  ECONOMIC ENVIRONMENT 
2.1  Recent Growth Record 
2.1.  According to the latest indicators, emerging  from the recently revised estimates of national 
income brought out by the Central Statistics Offi ce, economic growth, measured by growth in 
Gross Domestic Product (GDP) at constant market prices, is estimated at 5.1% and 6.9% 
respectively during 2012-13 and 2013-14. Growth for the year 2014-15 is likely to be 7.4%. 
2.2.  The estimates at disaggregated level (Table 1) indicate that growth in agriculture and allied 
sectors – including crops, livestock, forestry and logging, and fishing – picked up in 2013-14. The 
manufacturing sector registered a growth of 6.2% and 5.3% respectively in 2012-13 and 2013-14. 
The services sector triggered the growth momentum  in 2013-14. Services such as trade and repair 
services, rail transport, communication and broadcasting services and miscellaneous services 
achieved double-digit/close to double-digit growth during the year. 
Table 1 Growth in GVA(Gross Value Added)  at Constant (2011-12) Basic Prices  
(%) 
 2012-13 2013-14 2014-15 
Agriculture, forestry & fishing 1.2 3.7 1.1 
Industry 2.3 4.5 5.9 
Mining & quarrying -0.2 5.4 2.3 
Manufacturing 6.2 5.3 6.8 
Electricity, gas, wa ter, supply & other 
utility services  4 4.8 9.6 
Construction -4.3 2.5 4.5 
Services 8 9.1 10.6 
GVA at basic prices 4.9 6.6 7.5 
GDP (at market prices) 5.1 6.9 7.4 
Source: Economic Survey, Government of India, 2014-15, Volume II.  
2.3.  The services sector continues to account fo r more than 50% of the Gross Value Added in the 
country and its share has been slowly increasing  over the years. However, the share of the WT/TPR/G/313 • India 
 
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  agricultural sector is witnessing a gradual decline, with its share estimated to be 19% in 2014-15 
(Table 2). The share of industry has declined since 2011-12 and accounts for a little more than 28% of GDP in 2014-15. 
Table 2 % Share of different se ctors in GVA at basic prices 
Year Agriculturea Industryb Servicesc 
2011-12 21.58 29.90 48.52 
2012-13 20.77 29.27 49.96 
2013-14 20.24 28.67 51.09 
2014-15d 19.07 28.36 52.58 
a Agriculture includes agriculture, fore stry & fishing, mining & quarrying. 
b Industry includes manufacturing, construction, electricity, gas & water supply. c Services include trade, hotels and restaurants; transp ort, storage and communication; financing, 
insurance, real estate and bu siness services; community, social and personal services. 
d Advance estimates. 
Source: Calculated on the basis of Stat istical Tables in Economic Survey, 2015. 
2.2  Savings and Investment 
2.4.  After reaching its historical peak in 2007-08 (36.8%), the gross domestic savings as a 
proportion of GDP (at market prices) declined from 33.9% in 2011-12 to 30.6% in 2013-14. Gross 
Capital Formation (GCF), as a proportion of GDP, declined from 38.2% in 2011-12 to 32.3% in 
2013-14, on account of a fall in investment by both the corporate and household sectors. Though public sector investment increased during the period, it was not sufficient to compensate for the 
lower investment by the corporate and household sectors.  
2.3  Inflation  2.5.  Inflation had been a significant economic  challenge confronting the economy since 2010-11. 
Retail inflation, as measured by the Consumer Price Index (CPI) (combined)
1 had remained 
stubbornly sticky at around 9-10% during 2012-13 and 2013-14. However, since the second quarter of 2014-15, both WPI (Wholesale Pric e Index) and CPI inflation have moderated 
significantly, with moderation in inflation observed in all the three major subgroups, viz. food and 
beverages, and tobacco; fuel and light; and others. As per the revised CPI (new series) with the 
base year 2012, headline CPI inflation stood at 5.1% in January 2015. 
2.6.  The decline in inflation was the result of bo th global and domestic factors. Global factors, 
namely the decline in crude prices, soft global prices of tradables, particularly edible oils and even 
coal, helped moderate headline inflation. At home , the tight monetary policy of the Reserve Bank 
of India (RBI) was helpful in keeping the demand  pressures contained, creating a buffer against 
any external shock, and keeping volatility  in the value of the rupee under check.
2 
2.4  Exports, Imports and Trade Balance 2.7.  During the four-year period under review (2010-11 to 2013-14), exports grew at a 
compound annual growth rate of 8.0%, while imports grew by 6.8%. India's share in global 
exports registered a small increase from 1.5% in 2010 to 1.7% in 2013. Its share in world imports 
increased from 2.3% in 2010 to 2.5% in 2013. 
2.8.  The Indian economy has continued the trend of increasing trade openness during the period 
under review. India's total trade in goods (exports plus imports) as a percentage of GDP was 
42.4% in 2008-09 which declined to 36.3% in 2009-10, as a result of the global economic crisis (Table 3). It however recovered in the following years and the trade-GDP ratio increased to 44.1% 
by 2013-14.  
                                               
1 Base year 2010=100. 
2 Economic Survey of India, 2014-15. WT/TPR/G/313 • India 
 
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  Table 3 Merchandise trade: exports, impo rts, trade balance, and trade openness 
(US$ billion, unless otherwise specified) 
 Exports Imports Trade Balance Trade 
Openness 
Year Exports % 
growth as % of 
GDP Imports % 
growth as % of 
GDP Trade 
Balance as % of 
GDP Trade as % 
of GDP 
2010-11 251.1 40.5 14.5 369.8 28.2 21.4 -104.8 6.1 34.5
2011-12 306.0 22.5 16.60 489.3 32.3 26.6 -183.4 -10.7 46.4
2012-213 300.4 -1.8 17.61 490.7 0.3 28.8 -190.3 -11.2 46.5
2013-14 314.4 4.7 19.20 450.2 -8.3 27.4 -135.8 -7.8 44.1
2014-15a 241.1 4.0 13.75 351.2 3.6 20.0 -110.0 -6.3 33.8
Note: GDP at constant market prices. 
 The US Dollar conversion rates calculated on  the basis of monthly average rates of RBI. 
a Provisional - for the period April-December. Source: Economic Survey, 2014-15. 
2.4.1  Merchandise exports 
2.9.  After registering a very high growth of 37. 5% in 2010-11, the growth of merchandise exports 
moderated to 22.5% in 2011-12. The high growth in  two years led to overall exports crossing the 
US$300 billion mark. In 2012-13, though exports were still above the US$300 billion mark, the 
growth in exports could not be sustained and marginally declined by 1.8%. During 2013-14, 
however, exports recovered to post a grow th of 4.7% (US$314.4 billion). In 2014-15 
(April-December), the growth of exports modera ted to 2.4% (to reach US$241.1 billion compared 
to US$237.73 billion for the same period in 2013-14).  
2.10.  In 2013-14, the major commodity groups in India's export basket in terms of percentage 
shares were Petroleum Crude and Products (20.1%); Gems and Jewellery (13.2%); Textiles and 
Allied products (11.8%); Agri and allied produc ts (10.5%); and Chemicals and Related Products 
(9.8%). 
2.4.2  Merchandise imports 
2.11.  During the four-year period under review (2010-11 to 2013-14), imports grew by 6.8%. In 
2014-15 (April-December), imports grew by 3.6% to US$351.2 billion as compared to US$338.9 billion in 2013-14 (April-December). Non-POL and non-gold and silver imports which 
largely reflect the imports needed for industrial activity grew by 7.8% in 2014-15 (April-January), 
after registering a decline of 0.7% and 6.9% respectively in 2012-13 and 2013-14. 
2.12.  In 2013-14, the major commodity groups in India's import basket in terms of percentage 
shares were Petroleum Crude and Products (36.6%); Gems and Jewellery (13.0%); Chemicals and 
Related Products (7.9%); Electronic Items (7.2%); and Machinery (6.9%). WT/TPR/G/313 • India 
 
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  Figure 1 Import and export growth rates 
-20%-10%0%10%20%30%40%
2010-2011 2011-2012 2012-2013 2013-2014 2014-15pExports
Imports
 
Source: Union Budget, Economic Survey of India 2014-15. 
2.4.3  Trade Balance 
2.13.  The trade deficit, as a percentage of GDP, increased from 8.5% in 2009-10 to 11.2% in 
2012-13. It more than doubled within the space of four years, from US$88.5 billion in 2007-08 to 
US$183.4 billion in 2011-12. It rose further to US$190.3 billion in 2012-13 before falling in 
2013-14 to US$135.8 billion as a result of various steps taken by the Government. The heavy dependence on imports of essential commodities including crude oil, gas, coal, pulses, edible oils, 
fertilizers, electronics etc. has kept India's trade deficit at a high level.  
Figure 2 Merchandise trade: exports, imports and trade balance 
(US$ billion) 
-300-200-1000100200300400500600
2007-2008 2008-2009 2009-2010 2010-2011 2011-2012 2012-2013 2013-2014Exports Trade balance Imports
 
Source: Union Budget, Economic Survey of India 2014-15. 
2.4.4  Direction of Merchandise Trade 
2.14.  There has been significant market diversific ation in India's trade in recent years –a process 
that has helped in coping with the sluggish global demand. 
2.15.  Region-wise, India's export shares to Eu rope and America have declined over the years – 
from 23.6% and 20.1% respectively in 2004-05 to 18.6% and 17.2% respectively in 2013-14. WT/TPR/G/313 • India 
 
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  However, the United States of America continues to be the topmost destination for India's exports 
with a share of 12.4% followed by the United Arab  Emirates (9.7%) and China (4.7%) in 2013-14. 
2.16.  The shares of India's exports to Asia and Africa have increased from 47.9% and 6.7% 
respectively in 2004-05 to 49.4% and 9.9% respectively in 2013-14. Exports to Asia still 
constitute around 50% of India's exports. While India's exports to ASEAN (Association of South 
East Asian Nations) grew only by 0.4%, exports to  South Asia grew at 15.9% with high growths to 
all the four major SAARC (South Asian Association for Regional Cooperation) countries, Sri Lanka, 
Bangladesh, Nepal and Pakistan, besides Bhutan. Exports to China and Japan grew at 9.5% and 
11.7% respectively.  
2.17.  As regards imports, the share of Europe in India's imports also declined from 23.0% in 
2004-05 to 15.8% in 2013-14 while the shares of Asia and Africa increased substantially from 
35.6% and 3.6% in 2004-05 to 60.7% and 8.1% respectively in 2013-14. The share of America in 
India's imports has also increased from 8.8% to 12.8% during the same period. China is the major source of India's imports, accounting for 11.3% of India's total imports, followed by Saudi Arabia 
(8.1%), the UAE (6.5%), and the United States (5.0%) in 2013-14.  
2.18.  The top three trading partners of India are China, the United States, and the UAE, with the 
top slot shifting among the three.  
2.4.5  Services Trade 
2.19.  The services sector plays a very important ro le in the Indian economy. The high growth rate 
achieved by the Indian economy over the last de cade or so has much to owe to the Services 
sector. The services sector contributes more than 50% to the GDP of the country, 35% to exports 
and accounts for more than 50% of FDI into the country.  
2.20.  India's services exports continued on their successful growth path in the last four years. 
During the period 2010-11 to 2013-14, the CAGR of services exports was 6.7%, slightly lower than 
the 8% for merchandise exports during th e same period. Services exports reached 
US$151.5 billion in 2013-14 with a growth of 4.0% over the previous year. The IT/ITeS sector 
dominates India's services exports. The other major categories of services exports in 2013-14 
included business services, travel and transportation. 
2.21.  Imports of services decreased from US$80.6 billion in 2010-11 to US$78.5 billion in 
2013-14. The major categories of services imports in 2013-14 included business services, transportation, travel and financial services. 
2.22.  During the period under review, the balance of trade in services has remained positive 
(Table 4). However, this surplus has not been  sufficient to bridge India's trade deficit. 
Table 4 Trade in services 
(US$ billion) 
Year Exports Imports Net 
2010-11 124.6 80.6 44.1 
2011-12 142.3 78.2 64.1 
2012-13 145.7 80.8 64.9 
2013-14 151.5 78.5 73.0 
Source: RBI Handbook 2013-14. 
2.23.  Besides IT/ITeS, India has a huge potent ial in exports of other business services like 
Management Consultancy, professional services such as Accountancy, Architectural and Engineering Services, Medical Value Tourism, Audio-Visual Services, R&D Services, Wellness 
Tourism Services, Recreational Services, Financial Services, Construction Services and Health 
Related professional services. 
2.24.  Moreover, there exists tremendous potentia l in trade in services in almost all sectors 
through all the four modes of supply. Today, given the requirements of rapidly ageing populations 
and the compulsions to remain competitive in a highly globalised world, developed countries are 
increasingly relying on the services of skilled pr ofessionals from developing countries like India. WT/TPR/G/313 • India 
 
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  With its demographic advantage and the large pool of skilled and low cost English speaking 
workforce, India can well provide the solution to the world's skills shortage problem.  
2.25.  A new initiative to boost the export of services is the annual Services Conclave held twice so 
far. This is intended to bring all stakeholders on a single platform, identify issues and prepare a 
road map for the promotion of services exports. 
2.26.  The next logical step is to engage bu siness and governments from across the world to 
promote greater trade in services between India and the rest of the world. With this aim, the 
Ministry of Commerce and Industry, Government of India in association with the Services Export 
Promotion Council (SEPC) and the Confederation of Indian Industry (CII) is organizing a Global Exhibition on Services (GES) from 23 to 25 April 2015 in New Delhi. The main objective of the Exhibition is to create a global platform for increased trade in services. It is expected to enhance 
strategic cooperation and develop synergies to strengthen multilateral relationships between all 
stakeholders, tap the potential for services' exports and to increase FDI flow in the services sector. 
More than 40 countries are expected to participate in the GES. 
2.5  Foreign Investment 
2.5.1  Foreign Direct Investment (FDI) an d Foreign Institutional Investment (FII) 
2.27.  During the review period, FDI inflow reached an all-time high of US$46.5 billion in 2011-12, 
registering a year-on-year growth of around 34% (Table 5). However, since then, FDI inflows have 
hovered around the range of US$30-35 billion. Mauritius, Singapore, United Kingdom, Japan and Netherlands have been the largest sources of FDI inflow. The sectors that have attracted a high share of total inflows in recent years include services, construction, telecommunications, computer 
software and hardware, drugs and pharmaceuticals,  automobile industry, chemicals and power.  
Table 5 FDI inflows and net FII 
(US$ billion) 
Year Total FDI Inflows Net FII 
2008-09 41.8 -15.01 
2009-10 37.7 29.05 
2010-11 34.8 29.42 
2011-12 46.5 16.81 
2012-13 34.2 27.58 
2013-14 36.0 5.01 
2014-15a 31.8 - 
a April to November, 2014. 
Source: RBI. 
2.28.  Net FII inflows have seen a high degree of volatility during the period, largely due to the 
developments in the international financial scene. In 2013-14, net FII inflow was US$5 billion.  
2.5.2  Outward Investment by India 2.29.  Outward FDI investment by India stood at US$17.1 billion in 2010-11 and declined to 
US$11.1 billion in 2011-12 and further to US$7.1 billion in 2012-13. In 2013-14, it increased 
marginally to US$9.2 billion. The major destinations of India's outward investment in 2013-14 included British Virgin Islands, Mozambique, Netherlands, Singapore, Mauritius and the 
United States. Agriculture and mining (US$6.3 bi llion) accounted for the largest share of outward 
FDI during 2013-14 followed by the manufacturing sector (US$2.6 billion) and financial, insurance and business services (US$1.8 billion). 
2.6  Major Challenges  
2.6.1  Agriculture and Food Security 2.30.  While nearly half of the population of the country is engaged in agriculture for livelihood, the 
share of agriculture in total GDP is only aro und 20%. As against a growth target of 4% for WT/TPR/G/313 • India 
 
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  agriculture and allied sectors for the period 2012-17, the growth registered in the first year was 
1.2%, 3.7% in 2013-14 and 1.1% in 2014-15. In recent times, agricultural incomes in the country are under stress on account of the rising cost of inputs and the inability of farmers to get reasonable prices for their produce.  
2.31.  Given the limited scope to increase the area under production, future agricultural growth is 
contingent on increasing agricultural productivity. This is necessary not only to ensure reasonable 
returns to farmers but also to bolster food securi ty – including availability and affordable access. 
Measures are required to increase the irrigated ar ea, improve the efficiency of existing irrigation 
systems and promote agro-based industry for valu e addition. Moreover, the agriculture and food 
sectors need huge investment in research, education, extension, fertilizers, and laboratories to test 
soil, water, and commodities, and warehousing, and cold storage.  
2.6.2  The Manufacturing Challenge  
2.32.  India accounts for 1.8% of the world's manufacturing output. However, manufacturing 
growth, in recent years, has remained tepid. The share of manufacturing has stagnated at about 
16% of GDP and manufacturing exports have rema ined stagnant at about 10% of GDP. While 
basic and capital goods appear to be on the path of recovery, intermediate goods are yet to emerge out of difficulties, and the consumer good s sector led by consumer durables continues to 
experience negative growth. Our second major challenge is thus to boost industrial growth in 
general and manufacturing growth in particular. This is imperative because of the large numbers joining the work force each year; the limited ability of the Services sector alone to absorb low-skill 
workers and a saturation in the absorption capacity of agriculture. 
2.33.  The Government's "Make in India" initiative aims to promote the country as an investment 
destination, spur manufacturing and promote employment. It also envisages the development of infrastructure including i-ways besides highways, ports, optical fibre networks, gas grids and water 
grids. 
2.6.3  Infrastructure Development  2.34.  One of the major challenges to India's growth is the infrastructure deficit. Massive 
investment is needed to build the infrastructure required to sustain a high growth rate, including 
roads, railways, ports, airports, electricity, telecommunications, oil gas pipelines and irrigation.  
2.35.  According to the Twelfth Five Year Plan pr ojections, during the Plan period – 2012-17, an 
investment of US$1 trillion is required in the infrastructure in India. Recognizing the pressing need 
to increase public investment, budgetary support for infrastructure has been substantially 
increased in the Budget for 2015-16. Major initiatives announced for funding infrastructure creation include a National Investment and Infrastructure Fund, tax free infrastructure bonds for 
projects in the rail, road and irrigation sectors an d revitalization of the PPP mode of infrastructure 
development. Ports in the public sector will be encouraged to corporatize, and become companies 
under the Companies Act so as to be able to attract private sector investment as well as leverage 
the huge land resources lying unused with them.   
2.36.  The Government also proposes to set up 5 new Ultra Mega Power Projects, each of 
4,000 MWs in the "plug-and-play" mode, i.e. all clea rances and linkages will be in place before the 
project is awarded by a transparent auction system. The Government is also considering a similar 
approach in other infrastructure projects such as roads, ports, rail lines, airports etc.  
2.37.  Overcoming infrastructure bottlenecks is also the key to achieving accelerated export 
growth. Better multi modal transportation is required for improved road connectivity to ports, rail 
heads and airports, faster throughput at ports an d shorter dwell time, faster movement of rakes 
by railways and quicker air cargo movement coupled with the requisite trade facilitation measures. 
2.38.  Supportive infrastructure required for exports includes laboratories for testing, more tool 
rooms and plant quarantine facilities, larger trade facilitation centres and land customs stations 
and enhanced cold storage facilities for pharmaceutical and perishable goods.  WT/TPR/G/313 • India 
 
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  2.39.  While India is now a significant supplier of agro products to the world, these remain largely 
confined to commodities such as cereals, groundnut, castor, oil meals, guar gum etc. of which surpluses are limited. India aims to promote a shift in focus towards processed and value added exports, niche products such as organic, culinary herbs and herbal products. For this, a range of 
facilities and infrastructure is needed on the post-harvest front, such as: cold chain facilities and 
transport logistics from the farm to the ports and airports; silos with temperature control mechanisms to preserve the quality of produce; state-of-the-art pack houses with complete cold 
chain arrangements; and integrated post-harvest facilities and centres for perishable cargo with 
uninterrupted power supply and connection to National Highways.  
2.40.  Containerized trade is growing in importance. On the lines of Container Freight Stations 
(CFSs) and Inland Container Depots (ICDs) fo r maritime cargo, similar off-site clearing 
mechanisms for air cargo, known as Air Freight St ations (AFSs), have been approved. Approval for 
AFSs will also be provided through the same single window mechanism that approves ICDs and CFSs. A plan for development of ICD/CFS/AFS ha s been prepared. The development of container 
trade and infrastructure depends in turn upon th e development of ports, railways, road networks, 
warehouses, shipping and logistics companies. 
2.41.  India's Special Economic Zones Scheme has enabled the development of world class 
infrastructure facilities to some extent. The concept of Special Economic Zones reflects the core 
philosophy of the Government's Make in India initiative in its emphasis on promoting the 'ease of doing business' through the simplification of pr ocedures, online processing and approvals, and 
accountable and transparent procedures. This  Scheme will be further strengthened. 
2.6.4  Increasing demand on public investment and the need for fiscal discipline 
2.42.  Fourth, the country is facing two conflict ing challenges – the short-term imperative of 
boosting public investment to revitalize grow th and ensure development with the need for 
maintaining fiscal discipline. Public investment is indispensable for supporting several important 
national priorities such as agriculture, education, health, and rural infrastructure, along with programmes targeted for the poor and the under-privileged. Meeting such priorities, however, not 
only reduces fiscal space, but in fact, squeezes it. Meeting the fiscal deficit target of 3% of GDP in 
2017-18 is a daunting challenge. 
3  THE NEW REFORM AGENDA 3.1.  The Government has embarked on an ambiti ous reform agenda to meet the challenges of 
spurring growth, creating jobs and improving the quality of life of the common man. Over the last 
few months, various initiatives have been announced for financial inclusion, health and hygiene of the common man, the education of girls, employment for the youth, an improved and non-
adversarial tax administration, effective delivery of  benefits, investment and job creation, welfare 
of labour, improving agricultural productivity and increasing farm incomes, enhancing digital 
connectivity, skilling youth; and impr oving the ease of doing business. 
3.1  Ease of Doing Business 
3.2.  To improve India's low ranking on ease of doing business parameters, reforms are being 
undertaken in areas such as starting a business, de aling with construction permits, registration of 
property, power supply, paying taxes, enforcing co ntracts, and resolving insolvency. The important 
measures that have been undertaken are: 
• liberalization of licensing and deregulation of a large number of defence products;  
• extending the validity of licenses to provide enough time to licensees to procure land and 
obtain the necessary clearances/ approvals from authorities; 
• adoption of a checklist with specific time-lines for processing all applications filed by 
foreign investors in cases relating to retail/non-resident Indian (NRI)/export-oriented 
unit (EoU) foreign investments; WT/TPR/G/313 • India 
 
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  • automation of processes for registration with the Employees Provident Fund Organization 
and Employees State Insurance Corporation;  
• processing of environment and forest clearances online; 
• reducing the number of documents for exports; 
• Adoption of best practices by states in granting clearances and ensuring compliance 
through peer evaluation, self-certification, etc. 
3.2  Make in India  
3.3.  The Make in India programme aims to facilitate investment, foster innovation, enhance skill 
development, protect intellectual property, and bu ild best-in-class manufacturing infrastructure. 
Information on 25 sectors has been provided on a web portal along with details of FDI policy, 
National Manufacturing Policy, intellectual property rights, and the Delhi-Mumbai Industrial 
Corridor and other National Industrial Corridors. An Investor Facilitation Cell has been created in 
'Invest India' to guide, assist, and handhold investors. 
3.3  Reforms in FDI policy  
3.4.  Over the years India has put in place an  investor-friendly FDI policy, which has been 
progressively liberalized and rationalized. FDI up to 100% is permitted under the automatic route in most sectors/activities.  
3.5.  The Government has liberalized the FDI policy in the defence sector by raising the FDI cap 
from 26 to 49%. Further, FDI above 49% has also been allowed subject to approval by the Cabinet Committee on Security, to allow access to modern  and 'state-of-art' technology. 100% FDI under 
the automatic route has been allowed in specified rail infrastructure projects. The Indian 
Parliament has recently passed the Insurance Laws (Amendment) Bill 2015 which, among others, 
raises the FDI cap in the insurance sector from 26 to 49%. It was announced in the Budget 2015-16 that in order to further simplify the procedures for Indian companies to attract foreign 
investments, there would no longer be any distinction between different types of foreign 
investments, especially between foreign portfolio investments and foreign direct investments; instead there would be a composite cap. The sectors which are already on a 100% automatic route 
would not be affected. 
3.4  Introduction of Goods and Services Tax  3.6.  A major game changing reform in the near future would be the introduction of the Goods and 
Services Tax (GST) effective from 1 April 2016. Th e implementation of the GST would lead to the 
elimination of other taxes such as Central Excise duty, Service tax, State Value-Added tax, octroi, 
Central Sales Tax, State-level sales tax, entry tax, stamp duty, turnover tax, tax on consumption or sale of electricity and taxes on transportation of goods and services, thus removing the multiple 
layers of taxation that currently exist in India.  
3.7.  The GST is expected to help Indian exporters significantly. The simplification and 
harmonization of the indirect tax regime of the co untry will make Indian trade and industry more 
competitive by integrating markets, reducing inflation and the cost of production.  
3.5  Skill development 3.8.  India is one of the youngest nations in the world with more than 54% of the total population 
below 25 years of age. The current size of In dia's formally skilled workforce is small, 
approximately 2%. Moreover, as per the National Skill Development Corporation of India, for the 
period between 2013 and 2022 there is an incremen tal requirement of 120 million skilled persons 
in the non-farm sector. To meet this challenge, a dedicated Department of Skill Development and 
Entrepreneurship to promote skill and entrepreneurial activities has been set up. Work is being 
undertaken on setting up common norms for skill training across central ministries/ departments. Thirty- one industry/employer-led Sector Skill Councils (SSCs) are now operational and these have WT/TPR/G/313 • India 
 
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  been aligned with the 25 sectors of "Make in In dia". Efforts are on to create a common standard 
for skills training and certification in the country. 
3.6  Labour-sector reforms 3.9.  The multiplicity of labour laws is often cited as an obstacle to industry. A number of measures 
have been initiated to make it easier to comply with these laws and do business. The objective is 
to align the laws with the requirements of a changing labour market. These include the launch of a unified labour portal ("Shram Suvidha" portal) for online registration of units, filing of self-certified, 
simplified, single online returns by units, introduction of a transparent labour inspection scheme 
via computerized system as per risk-based criteria, uploading of inspection reports within 72 hours and timely redressal of grievances. A Universal Account Number has been launched facilitating portable, hassle-free, and universally accessible Provident Fund accounts for employees. The 
Apprentices Act, 1961 has been amended so as to make it flexible and attractive to youth and 
industry and a scheme has been launched to support micro small and medium enterprises (MSME) in the manufacturing sector in engaging apprentices (the "Apprentice Protsahan Yojana").  
3.7  Fostering Inclusive Growth 
3.10.  A major programme for financial inclusion,  the Pradhan Mantri Jan Dhan Yojana (PMJDY) 
was launched on 28 August 2014. The PMJDY envisages universal access to banking facilities with 
at least one basic banking account for every hous ehold. The scheme is expected to provide a big 
push to the Direct Benefits Transfer scheme. In a short period of 100 days, over 125 million families had already been brought into the financial mainstream. The PMJDY platform is also being used to design and launch a slew of social security  schemes to ensure that every Indian citizen is 
provided suitable cover during illness, accidents, or penury in old age. 
3.8  Rationalizing Subsidies 3.11.  The endemic poverty in India, the persistent inequalities of income and opportunities, the 
challenges of earning a livelihood in rural areas and currently inadequate financial inclusion make 
it essential for government to provide support through a range of subsidies. At the same time, it is critical to ensure that these subsidies reach their intended beneficiaries and achieve their 
objectives. The debate today is not about whethe r, but how best to provide active government 
support to the poor and vulnerable. Subsidies for some purposes can be effectively provided through direct cash transfers. For example, cookin g gas subsidies are now being paid directly into 
the bank accounts of about 97.5 million recipients.  
3.12.  The Government supports the farm sector in India through various programmes for 
agricultural research and education, extension, irrigation and for facilitating easier and cheaper access to inputs such as seeds, fertilizers and credit. An important policy instrument used by the 
government for supporting farmers and ensuring India's food security is the Minimum Support 
Price (MSP) scheme. Food grains are procured from  farmers at the MSP for the Public Distribution 
System.  
3.13.  Given the large numbers engaged in agricultural activities, on a per capita basis, the 
support to farmers is far below the levels of suppo rt extended by many of the developed countries. 
Moreover, the support extended in India seeks to sustain the livelihoods of the scores of small and 
marginal farmers rather than for large scale commercial farming.  
3.14.  The Government has undertaken various measures such as decentralized procurement, to 
enhance the efficiency of procurement and public distribution, to extend the benefits of MSP to local farmers and to remove the bias towards wheat and rice in incentive structures. An ambitious 
Soil Health Card Scheme has been launched to improve soil fertility on a sustainable basis.  
4  TRADE POLICY 4.1  Foreign Trade Policy 
4.1.  International trade is an important part of India's economy with merchandise trade 
constituting around 44% of the country's GDP in 2013-14 as compared with 34.5% in 2010-11. WT/TPR/G/313 • India 
 
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  India's share in world services exports (at 3.3% in  2013) has been increasing faster than its share 
in world merchandise exports. India's foreign trade policy is primarily focused on accelerating exports. This is sought to be implemented thro ugh various schemes intended to exempt and remit 
indirect taxes on inputs physically incorporated in  the export product, concessional duty import of 
capital goods, stimulating services exports, fo cus on specific markets and products etc. The 
Foreign Trade Policy (FTP) attempts to dovetail these schemes with the specific market access openings that India has achieved through negotiations with its trading partners for various 
bilateral and regional trading arrangements.  
4.2.  The FTP has, conventionally, been formulated  for five years at a time and reviewed annually. 
The FTP for the period 2015-20 is being formul ated by the Department of Commerce and will 
shortly be announced. 
4.3.  Market and product diversification will continue to be the twin pillars of the FTP. The Foreign 
Trade Policy 2009-14 included several measures to encourage exports through greater diversification of export destinations in Latin America, Africa, East Europe, parts of Asia and 
Oceania and by focussing on exports of products  with high export intensity and employment 
potential.  
4.4.  India seeks to further achieve growth through focus on manufacturing and exports of 
value-added agricultural products, products with high potential and high technology products and 
products which are important for regional value chains.  
4.5.  India has deliberately kept governmental intervention in trade policy to the minimum even 
during the peak of the global economic crisis. While several countries resorted to various forms of 
protectionist trade measures such as liberal doses of subsidies to their enterprises, restrictions on 
imports, fiscal incentives, and promoting the purchase of domestically produced goods and 
services, India, on the other hand, resorted to fe w trade restrictions during the crisis; and even 
these measures were temporary and quickly dismantled.  
4.6.  India's foreign trade policy reflects its unwavering commitment to trade liberalization and 
deeper integration with the global economy. Impo rt duties have been autonomously lowered over 
the years. While the average bound MFN rate for all products is around 48%, the applied rates are 
much lower than the bound rates especially in th e case of agricultural goods, a testament to 
India's steady and continued autonomous tariff liberalization. The simple average MFN applied tariff for all products was just about 13.7% and for non-agricultural products 10.4% in 2012. As 
many as 69% of India's agricultural tariff lines attracted MFN applied tariffs ranging from 25 to 
50% ad valorem . In case of non-agricultural tariff lines, the MFN applied rates range from 5 to 
10% ad valorem  for as many as 76% tariff lines. Apart from the occasional adjustment in the 
tariffs on some agricultural commodities in the face of high volatility in food prices, in most cases 
tariffs have been reduced rather than raised and have generally been continued at the lower 
levels. 
4.7.  Tariff policy will  be further optimised in order to take advantage of the manufacturing 
opportunities offered by regional and global value chains, while retaining the necessary policy space to strengthen and develop domestic industry.  
4.2  Trade Facilitation Measures 
4.8.  A number of initiatives are being introduced to make export and import competitive and 
reduce transaction costs. These include reducing the number of documents, enlarging the scope of 
electronic data inter-change (EDI), promoting a cceptance of electronic in place of physical 
documents and seamless flow of information amongst the various Departments or agencies 
involved in border management. Steps are also being taken to convert the remaining non-EDI ports into EDI ports to ensure speedier processi ng by Customs at a larger number of locations, 
enlarge the scope of self-assessment and risk management systems at the Customs.  
4.9.  Steps are being taken by various Ministries and Departments to simplify administrative 
procedures and reduce transaction costs based on  the recommendations of two Task Forces on 
Transaction Costs. One of the major trade facili tation projects implemented during the review 
period, is the linking of banks and offices of th e Directorate General of Foreign Trade. The eBRC WT/TPR/G/313 • India 
 
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  (Electronic Bank Realization Certificate) project launched on 5 June 2012 created an integrated 
platform for receipt, processing and subsequent use of all information related to bank realization. Since August 2012, DGFT started accepting eBRCs uploaded by banks onto the DGFT server instead of physical copies of BRCs. This has br ought down the cost of doing business for Indian 
exporters and enhanced the productivity of banks, DGFT and many other organizations.  
4.10.  A trade portal (www.indiantradeportal.in) was launched on 8 December 2014. This portal 
provides vital information to Indian industry on forty-two export markets and also a mechanism to 
take advantage of the increased market access provided through various regional and bilateral free 
trade agreements (FTA) and comprehensive economic cooperation/partnership agreements. The information can be accessed in four easy steps, whic h will contribute to ease of doing business. It 
will also help exporters to utilize the FTAs and ta ke advantage of the preferential tariffs available 
to them in various countries. 
4.11.  Recognizing the synergetic relationship between standards and trade, India organized a 
Standards Conclave in 2014 at New Delhi. The objective was to arrive at a coordinated national 
response to meet the challenges of standards and conformity assessment procedures. Participants 
included regulators, standard setting bodies, accreditation bodies and industry bodies. The 
stakeholders were sensitised on the importance  of international standards and the need to 
harmonise domestic standards with the international ones, wherever possible. The Standards 
Conclave is planned to be held as an annual event. Further, the legislative and institutional reforms identified through the deliberations of th e Standards Conclave such as amendments to the 
BIS (Bureau of Indian Standards) Act, have been initiated. 
4.12.  Yet another important significant initiative is the E-Biz Project. A Government to Business 
(G2B) portal has been set up to serve as a one-stop shop for delivery of services to investors and to address the needs of business and industry from  inception through the entire life cycle of the 
business. Entrepreneurs can apply online for industrial licences and industrial entrepreneur 
memorandums and this service is now available on 24x7 basis. Other services of the central government are being integrated on top priority. An Expert Committee is being appointed to 
examine the possibility of obviating the need for multiple prior permissions.   
4.3  Trade Policy Challenges 4.13.  India's share of world trade continues to be small, with only a slight increase from 1.3% in 
2009 to 1.7% of global merchandise exports in 2013. Further, given uncertainties in the 
international economic environment in general and within India's major trading partners in 
particular, the country foresees challenging times ahead for its trade sector. Moreover, domestic factors like weak infrastructure, rising wages and scarcity of skilled labour in the case of services 
are inhibiting growth of trade and related activities. 
4.14.  The rising incidence of non-tariff barriers, in the form of sanitary and phytosanitary (SPS) 
measures and technical barriers to trade (TBT), continues to remain a major trade concern. While 
tariffs have been going down globally (also as a concomitant to rising number of FTAs), the use of 
technical regulations/mandatory standards as barriers has grown, along with the growth of a variety of conformity assessment procedures. The resultant increased transaction costs arising from complying with such regulatory requirements adds to the costs of India's exports and erodes 
price competitiveness. 
5  INDIA AND THE WTO 5.1  WTO Negotiations 
5.1.  In keeping with its strong commitment to multilateralism and the Doha Development Agenda, 
India has been working with rest of the WTO Member ship to ensure that the imbalances in global 
trade rules are corrected in order to ensure better integration of developing countries in 
international trade. 
5.2.  The outcome of the Bali Ministerial Conference  of the WTO in December 2013 is significant for 
its recognition of some of the imbalances in the agricultural trade rules through the decisions on the issues of public stockholding for food securi ty purposes, and export competition. The need for WT/TPR/G/313 • India 
 
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  policy space in the area of food security, a very  genuine requirement of the developing countries 
to ensure the livelihood and food security of their poor, was not only recognized but it was also decided in November 2014 in WTO to find a permanent solution on the issue in a time bound manner. 
5.3.  A major outcome of the Bali Ministerial Conference is the decision on a Trade Facilitation 
Agreement (TFA). India is a party to this decision  and would abide by the obligation to notify its 
Category A and B commitments in accordance with the provisions of the Agreement. India has 
undertaken a host of autonomous reforms even be fore the WTO agreed to have a TFA, with the 
following objectives:  
i. To simplify laws and procedures and streamline fees and formalities dealing with 
release and clearance of goods; 
ii. To ensure greater transparency in trade law administration; and 
iii. To enhance and initiate measures for border cooperation and free movement of 
transit goods. 
5.4.  India took up customs modernization in 1990s with the introduction of the EDI (Electronic 
Data Interchange) system at major customs locations, which was subsequently rolled out to other locations. Some further trade facilitation reforms that India took up autonomously include the 
introduction of the "Risk Management System" and "Post Clearance Audit" for imports.  Very 
recently India has launched the Risk Management module for exports also. Where feasible, India allows for electronic payments of customs duties, which is again one of provisions in the Trade Facilitation (TF) text. In 2012, India launched the Authorised Economic Operators (AEO) 
Programme, based upon the WCO's SAFE Framework.   
5.5.  While substantive customs reforms have b een undertaken in India, the implementation of 
TFA involves multiple border management agencies owing to which its implementation is a 
challenge. While many of the TF provisions are already in place in India, some of them would 
require suitable legal and/or procedural modificati ons. In such cases, being a developing country, 
India would be entitled to adequate transi tion time for implementing the Agreement. 
5.6.  India is in the process of finalizing its categorization of commitments under the Agreement 
and would be filing the notification in keeping with  the provisions of TF agreement. The process of 
constituting a National Trade Facilitation Committee is also underway. 
5.7.  On future negotiations under the aegis of the WTO, India is committed to the Doha 
Development Agenda (DDA). The DDA primarily seeks to restore a balance in international trade 
by providing a level playing field to the developing countries. Special and Differential Treatment is the cornerstone of the DDA, as it provides opport unities to the developing countries to better 
integrate into the global trading system in accordance with their developmental needs. 
5.8.  Agriculture is the mainstay of the developing countries and India is no exception. With a 
large population dependent on agriculture, India has very high stakes in the negotiations on 
agriculture in the WTO. The historically high do mestic support and export subsidies available to 
farmers in the rich countries are a matter of grave concern to the developing countries. India's efforts are, therefore, to protect the interests of the poor farmers, which can be achieved through substantial reduction in the very high level of trade distorting subsidies given by some of the 
developed countries, as well as through specific provisions in the WTO Agreement on Agriculture to 
provide protections and options to the developing countries for a level playing field. 
5.9.  Similar cooperation is required to conclude the rest of the issues of the Doha Development 
Agenda. India is working with Members to en sure that the development mandate of the 
Doha round is not diluted. There is a need to re spect the special needs of the developing countries 
to encourage and protect their nascent and vulnerable industries, which include the micro, small 
and medium enterprises, employment intensive sectors, industries employing socially and 
economically vulnerable sections such as women, traditional artisans and fishermen, as well as industries in the rural, semi urban, economically disadvantaged and geographically inaccessible regions of the country.  WT/TPR/G/313 • India 
 
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  5.2  Duty Free Quota Free (DFQF) Access 
5.10.  One of the elements of the Hong-Kong Ministerial Declaration of December 2005 was to 
extend Duty Free Quota Free (DFQF) access to the Least Developed Countries (LDCs). India was the first developing country to extend this faci lity to Least Developed Countries (LDCs). India's 
Duty Free Tariff preference (DFTP) Scheme for LDCs came into effect in August 2008. The Scheme 
came into full operation in October 2012 with 85% of India's total tariff lines made duty free, 9% tariff lines enjoying a Margin of Preference rangin g from 10% to 100% and only 6% of total tariff 
lines retained in the Exclusion List with no duty preferences, for the exports from LDCs.  
5.11.  Moreover, to fully meet the obligations under the Hong Kong Ministerial Mandate of 2005, a 
proposal for expansion of India's DFTP Scheme was initiated by the Department of Commerce and the scheme has since been expanded. Effective from 1 April 2014, the DFTP scheme now provides 
duty-free market access on about 96 % of India' s tariff lines and 2.2% of the lines are under 
preferential duties. Only 1.8% of the tariff lines have been retained in the Exclusion List, with no duty concessions. 
5.12.  Apart from the recent expansion in the product coverage of the Scheme, there has also 
been an initiative to simplify the procedural matters related to the Rules of Origin provisions of the DFTP Scheme and would be notified in near future. 
5.13.  At present, 31 out of 48 LDCs have become  beneficiaries to the scheme. Out of this, 21 LDC 
beneficiaries are from Africa. The rest are countries in Asia and Asia-Pacific region.  
5.3  LDCs Services Waiver 5.14.  As per the WTO mandate and pursuant to the decisions of the WTO Ministerial Conferences 
and requests made by the LDCs, India has indicate d, in February 2015, preferential treatment to 
LDCs in respect of: 
i. Visa related issues  where India has agreed to waive the visa fee for LDC applicants 
seeking Indian business and employment visas. 
ii. Technical Assistance and capacity building  in financial services, insurance 
services, MSME sector, agriculture and rural development, railways & specially 
designed courses in consultancy services and technical assistance for development of 
chartered accountancy and company/corporate secretary professions in LDCs.  
iii. Market access commitments in 15 subsectors, improved commitments in 
4 sub-sectors and for a number of categories of professionals from LDCs. 
5.15.  India was the only WTO Member offering a waiver of visa fees. These preferences will 
remain valid for a period of 15 year s from the date of notification by  India. India proposes to notify 
these offers at the earliest.  
6  REGIONAL AND BILATERAL ARRANGEMENTS 
6.1.  In order to put exports on a high growth  trajectory, India needs a market diversification 
strategy based on the changing dynamics of growth  in the world economy. In future engagements, 
India seeks to engage with regions and countries that are not only promising markets but also 
major suppliers of critical inputs and have complementarities with the Indian economy. 
6.2.  India views regional trade agreements (RTA s) and preferential trading arrangements (PTAs), 
as "building blocks" towards achieving the overall objective of trade liberalization. India's initial 
foray into RTAs were through the Bangkok Agreement (1975), the Global System of Trade 
Preferences (GSTP, 1988), and the SAARC PTA (SAP TA, 1993). India has built on these initiatives 
to engage with countries and regional blocs around the globe. So far India has concluded 11 free 
trade agreements (FTAs) and 5 limited scope prefer ential trade agreements and is in the process 
of negotiating/expanding 17 more agreements. India's important trade engagements are briefly listed in this section. WT/TPR/G/313 • India 
 
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  6.1  South Asia Region 
6.3.  The seven member countries of SAARC (India, Pakistan, Nepal, Sri Lanka, Bangladesh, 
Bhutan, and Maldives) signed the Agreement on South Asian Free Trade Area (SAFTA) in the year 2004 which was joined by Afghanistan as the eighth member in 2007. The signing of the SAARC 
Agreement on Trade in Services (SATIS, 2010) ha s deepened the engagement. In addition, India 
has bilateral trade agreements providing prefer ential market access to Bhutan and Nepal, a 
preferential trade agreement (PTA) with Afghan istan (2003), and a free trade agreement with 
Sri Lanka (1998) which is being expanded into a Comprehensive Economic Partnership Agreement 
(CEPA) covering trade in services and investment. 
6.2  South East and East Asia 6.4.  The India ASEAN Trade in Goods Agreemen t became operational from January 2010 onwards 
(with different dates for ASEAN countries). The Services and Investment Agreement was 
concluded on 9 September.2014 and would enter into  force on 1 July 2015. Besides this India has 
signed a bilateral agreement with Thailand (2004) which is being expanded, a Comprehensive 
Economic Cooperation Agreement (CECA) with Singapore (2005), a Comprehensive Economic 
Cooperation Agreement (CECA) with Malaysia (2011) and has launched negotiations for a similar comprehensive agreement with Indonesia. The In dia-Republic of Korea Comprehensive Economic 
Partnership Agreement (CEPA) came into force in January 2010. A CEPA with Japan was signed in 
February 2011 which came into force in August 2011. 
6.3  Australia and New Zealand 6.5.  India has launched negotiations with New Zealand (2010) and Australia (2011) for a 
comprehensive agreement, covering economic cooperation, trade in goods, services and 
investments. 
6.4  Americas 
6.6.  Limited scope preferential trade agreements were signed with MERCOSUR and Chile in 2004 
and 2006, respectively. India is in the process of expanding these Agreements by widening the product coverage and deepening preferences. 
6.7.  India and Canada have launched negotiat ions in 2010 for a comprehensive agreement, 
covering trade in goods, services, investments and economic cooperation. 
6.5  Europe 6.8.  India is currently negotiating a Broad Based Trade and Investment Agreement (BTIA) with 
the European Union (28 countries) and the EFTA countries (Iceland, Norway, Liechtenstein and 
Switzerland). The negotiations cover goods, se rvices, investment, sanitary and phytosanitary 
measures and technical barriers to trade, trade facilitation and customs co-operation, etc. 
6.6  Middle East and Africa 
6.9.  India is negotiating a preferential agreement with the Southern African Customs Union 
(SACU). Negotiations are also underway for FTAs with the Gulf Cooperation Council (GCC), Israel 
and Mauritius. 
6.7  Other Agreements and Negotiations 6.10.  India is one of the members of the Global System of Trade Preferences (GSTP) which is an 
agreement among 43 developing countries and in tended to promote South-South trade. India 
participated in the third round of negotiations (known as the Sao Paulo Round) which was 
concluded in 2010. However, as of January 2015, only 3 countries namely Cuba, India and Malaysia have submitted their schedules of concessions. It would be ratified only if a 
fourth participating country submits its schedule. WT/TPR/G/313 • India 
 
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  6.11.  The Asia Pacific Trade Agreement (APTA, 2005), operational among six countries, namely, 
Bangladesh, China, India, Lao PDR, the Republic  of Korea, and Sri Lanka was the result of 
re-negotiations on the text of the Bangkok Agreement (1975). India is currently participating in the Fourth Round of Negotiations, which include the areas of goods, services, trade facilitation and 
investment. 
6.12.  India, as a member of a regional group co nsisting of Bangladesh, Bhutan, India, Myanmar, 
Nepal, Sri Lanka, Thailand (BIMSTEC, 1997) is negotiating an FTA in goods, services and 
investment amongst the members. As of January 2015, eighteen round of negotiations have been 
held under BIMSTEC. 
6.13.  India, is also negotiating the mega agreement known as the Regional Comprehensive 
Economic Partnership (RCEP) which constitutes the 10 countries of ASEAN and their six FTA 
partners namely Australia, China, India, Japa n, Republic of Korea, and New Zealand. The 
negotiations are comprehensive and cover a number of areas like goods (both tariffs and non tariff issues), services, investment, intellectual property, competition, economic and technical 
cooperation, and legal and institutional issues. 
7  CONCLUSION 7.1.  Overall, since India's last Trade Policy Re view in 2011, the Indian economy has weathered a 
number of challenges, both in the domestic and external sectors. However, since 2013-14 the 
economy seems to have turned the corner and there is an easing of the pressures associated with 
an economic slowdown, persistent inflation, an el evated fiscal deficit, slackening domestic demand, 
external account imbalances, and oscillating value of the rupee. Factors such as the steep decline 
in oil prices, plentiful flow of funds from the rest of the world, and the potential impact of the 
reform initiatives of the government coupled with its commitment to calibrated fiscal management and consolidation bode well for the growth pros pects and the overall macroeconomic situation.  
7.2.  At the same time, the Government is conscious of challenges that can be posed by the 
uncertainties in the external environment, possible spill-overs of below normal agricultural growth and challenges relating to the massive requirements of skill creation and infrastructural 
upgradation.  
7.3.  While pursuing its domestic economic agenda, India is equally aware of its international 
obligations as well responsibilities in the community of nations. While it looks forward to engaging itself in fruitful negotiations in the WTO to establish a more fair and equitable international trading 
system, it has been engaging itself in concluding/furthering new/existing trade as well as economic 
partnership agreements with its trading partners, both individually and collectively. The ultimate 
objective would be to reap the benefits of inte rnational trade to meet the development needs of 
the country.  
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