What Can EAEU-India FTA Bring to Indian Industrial Development?

At the St. Petersburg International Economic Forum in 2017, the Minister for Trade of the Eurasian Economic Commission, Veronika Nikishina and India’s Minister of State of Commerce and Industry, Nirmala Sitharaman met to sign a joint statement on the start of negotiations on a free trade agreement between the Eurasian Economic Union (EAEU) and India.

The proposed FTA would unite countries with total GDP of almost $4.5 trillion and a combined population of over 1.5 billion and could act as a strategic tool to stimulate mutual trade. Russian experts estimate that trade turnover could grow by 30–40 per cent depending on the depth of tariff liberalization. The Indian side predicts a three-fold increase in the total trade turnover of the six FTA countries by 2025, up to US$30 billion. Tariff liberalization within the FTA can have a positive effect on the dynamics of multilateral trade and among other things, stimulate trade in industrial products. It will push trade of fertilizers, machinery and equipment, weapons, vehicles, certain types of turbojet engines, salt, steel products, lumber, chemicals, rubber, and plastics, etc. and will potentially meet strategic priorities of the two countries.