India Takes FTA Benefits to the States: Outreach to Help MSMEs and Farmers Export More
The Department of Commerce has started a state-level outreach programme, working with state governments, to help small businesses (MSMEs: micro, small and medium enterprises), farmers and first-time exporters use India's free trade agreements (FTAs). India's trade pacts now cover 38 countries.
The aim is to raise FTA utilisation: the share of eligible exports that actually claim the lower tariffs an FTA offers. Studies suggest only about 20% to 30% of India's eligible exports claim these benefits.
Sessions titled "Leveraging FTAs" have been held in states such as Rajasthan (Jaipur) and Odisha (Bhubaneswar, 16 October 2026), with the Directorate General of Foreign Trade (DGFT), Export Promotion Councils (EPCs), state officials and industry bodies.
States have been asked to identify products and clusters that already benefit from FTAs, products where preferences remain unused, and possible first-time exporters, district by district.
The outreach covers FTAs and trade arrangements with partners such as the UAE, Australia, the EFTA countries (Switzerland, Norway, Iceland, Liechtenstein) and the United Kingdom, whose trade deal with India came into force on 15 July 2026.
The Department of Commerce has also set up an FTA Utilisation Cell to work with industry associations, EPCs and state governments.
Export Promotion Councils (EPCs)
Export Promotion Councils, or EPCs, are associations of exporters set up to help Indian businesses sell more goods and services abroad. Each council usually looks after one group of products, such as engineering goods, gems and jewellery, chemicals or leather. They are non-profit bodies, registered under the Companies Act or the Societies Registration Act, and they work closely with the Government of India. You can think of an EPC as a "help desk plus trade union" for exporters of one sector.
The state-level FTA outreach is being run by the Department of Commerce and DGFT together with EPCs, state governments and industry bodies. EPCs are the main channel through which sector-wise knowledge of FTA benefits, such as tariff cuts and certificates of origin, reaches MSMEs and first-time exporters in districts.
Free Trade Agreements: Concept and WTO Framework
A free trade agreement (FTA) is a deal between two or more countries to remove or sharply cut import taxes (tariffs) on most goods they trade with each other. Many modern FTAs also cover services, investment and rules on standards. India uses different names for such deals, such as CEPA (Comprehensive Economic Partnership Agreement), CECA, ECTA and TEPA, but the core idea is the same. Under World Trade Organization rules, such deals are allowed only if they cover "substantially all trade" between the partners.
An FTA only helps if exporters actually use it. The new state-level outreach aims to raise India's low FTA utilisation by explaining the benefits of these 38-country agreements to MSMEs and farmers directly in their own states.
Rules of Origin (RoO)
Rules of origin are the tests a country uses to decide where a product "comes from". They matter because an FTA gives low or zero tariffs only to goods that truly originate in a partner country. Without these rules, a third country could simply send its goods through an FTA partner to avoid tariffs. To claim FTA benefits, an exporter must usually show a certificate of origin.
Many small exporters skip FTA benefits because they find rules of origin and certificates confusing. A central part of the outreach is to explain these rules so that farmers, farmer producer organisations and MSMEs can prove origin and claim lower tariffs.
Foreign Trade Policy (FTP) 2023
The Foreign Trade Policy 2023 is the Government of India's main rulebook for exports and imports. It came into force on 1 April 2023 and, unlike earlier five-year policies, has no fixed end date. It is made under the Foreign Trade (Development and Regulation) Act, 1992, and is run by the DGFT. One of its key ideas is to make districts and states active partners in exports.
The new FTA outreach builds on the district and state machinery created under the FTP 2023. States are being asked to use this structure to map, district by district, which products can gain from FTAs and which first-time exporters can be brought in.
- India's trade pacts cover 38 countries
- India's FTA utilisation: estimated at about 20% to 30% of eligible exports
- Outreach sessions: Jaipur (Rajasthan); Bhubaneswar (Odisha), 16 October 2026
- FTA Utilisation Cell set up by the Department of Commerce
- India-UK CETA in force: 15 July 2026; about 99% of India's exports to the UK get zero duty
- India-EFTA TEPA in force: 1 October 2025 (Switzerland, Norway, Iceland, Liechtenstein)
- India's goods and services exports, April to September 2026-27: about $476.2 billion, up 13.84% from about $418.3 billion
- Target groups: MSMEs, farmers and farmer producer organisations, artisans, women-led enterprises and self-help groups