Free Trade Agreement (FTA)

Free Trade Agreement (FTA):

The Commerce and Industry Ministry said that India is in dialogue with Israel for concluding a Free Trade Agreement (FTA).

  • The announcement coincides with the 30th anniversary of the establishment of diplomatic ties between the two countries.

Free Trade Agreement (FTA):

  • It is a pact between two or more nations to reduce barriers to imports and exports among them.
  • Under a free trade policy, goods and services can be bought and sold across international borders with little or no government tariffs, quotas, subsidies, or prohibitions to inhibit their exchange.
  • The concept of free trade is the opposite of trade protectionism or economic isolationism.

India and FTAs:

  • After India opted out of the Regional Comprehensive Economic Partnership (RCEP) in November 2019, the 15-member FTA grouping that includes Japan, China and Australia, FTAs went into cold storage for India.
  • But in May 2021 came the announcement that India-European Union talks, which had stalled in 2013, would be resumed.
  • Both sides are now engaged in internal preparations to take these various strands of work forward.
  • Bilateral free trade agreements of India are being negotiated with the United Arab Emirates, the United Kingdom, Australia and Canada.
  • The agreement with the UAE was ‘close to finalisation’ while the FTA with Australia was at a ‘very advanced stage.’

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