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New Delhi: India has finalized terms for free trade agreement (FTA) talks with the Eurasian Economic Union (EAEU) as New Delhi steps up efforts to expand its trade partnerships amid strained relations with the US. The terms of reference (ToR) were signed in Moscow by Ajay Bhadoo, additional secretary in the Department of Commerce, and Mikhail Cherekaev, deputy director of the Trade Policy Department of the Eurasian Economic Commission (EEC).
India moves closer to FTA with Eurasian bloc amid strained trade talks with US
New Delhi: India has finalized terms for free trade agreement (FTA) talks with the Eurasian Economic Union (EAEU) as New Delhi steps up efforts to expand its trade partnerships amid strained relations with the US.
The terms of reference (ToR) were signed in Moscow by Ajay Bhadoo, additional secretary in the Department of Commerce, and Mikhail Cherekaev, deputy director of the Trade Policy Department of the Eurasian Economic Commission (EEC).
The EAEU comprises Armenia, Belarus, Kazakhstan, the Kyrgyz Republic and Russia, with a combined GDP of $6.5 trillion.
During the visit, Bhadoo also called on Andrei Slepnev, minister in charge of trade at the EEC, where both sides reviewed the milestone and discussed the next steps for the negotiation process.
India's trade turnover with the EAEU touched $69 billion in 2024, up 7% from the previous year. The proposed FTA is expected to open up new opportunities for Indian exporters, particularly among micro, small, and medium enterprises (MSME) and the pharmaceuticals, engineering goods, and agriculture sectors. It will also help New Delhi reduce its reliance on markets where trade tensions are rising, the ministry said.
“By fast-tracking an agreement with the EAEU, India is signalling its intent to diversify supply chains and strengthen partnerships with friendly economies at a time when tariff-related frictions with the US threaten to disrupt a large share of its exports,” said Abhash Kumar, trade economist and assistant professor, economics, Delhi University.
“The FTA could unlock untapped trade potential, boost investments, and build a durable institutional framework for cooperation. Both sides have reaffirmed their commitment to the early conclusion of the agreement,” the ministry said.
Russia has long been India's key and trusted partner. Recently, US President Donald Trump imposed an additional 25% tariff on Indian goods as a penalty for New Delhi's continued purchases of Russian oil, bringing the total duty on Indian goods to 50%, among the highest in the world.
Russian supply accounts for close to 40% of India's total crude oil imports, and Washington has accused New Delhi of “profiteering” from the discounted prices.
India's trade with the EAEU remains modest at present, but the potential is significant. Russia alone is a major supplier of energy, fertilizers, and defence equipment, while India has strong export prospects in pharmaceuticals, machinery, textiles, and agricultural products across the bloc. Market access through an FTA will open up opportunities for Indian companies in sectors such as information technology (IT) services, engineering goods, and processed food, where demand in EAEU economies is rising, a commerce ministry official said.
Source: LiveMint
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