Signing of Terms of Reference marks the formal commencement of Free Trade Agreement (FTA) negotiations with the goal to establish a long-term framework for trade cooperation.
Potential Benefits of FTA with EAEU
- Economic Benefits
- Trade expansion: It will unlock untapped trade potential, increase investments and establish a stronger, durable India–EAEU economic partnership.
- Bilateral Trade turnover stood at USD 69 billion in 2024 (7% rise from 2023).
- Market access: It will open wider opportunities for Indian exporters amid increasing US tariffs and support diversification into new sectors and geographies.
- Enhance competitiveness: It will strengthen India’s position against non-market economies.
- It will significantly benefit Indian Micro, Small and Medium Enterprises (MSMEs).
- Energy partnership: EAEU offers abundant natural resources and energy crucial for India’s growth.
- E.g. Russia now accounts for 35-40% of India’s total oil imports by volume.
- Trade expansion: It will unlock untapped trade potential, increase investments and establish a stronger, durable India–EAEU economic partnership.
- Strategic Benefits: Strengthening ties with Russia led bloc will reinforce India’s policy of multialignment.
About Eurasian Economic Union (EAEU)
- Overview: It is an international organization for regional economic integration.
- Genesis: Established by the Treaty on the Eurasian Economic Union (2014).
- Benefits: Provides for free movement of goods, services, capital, and labour, etc.