What Happened
- The Union Minister of State for Commerce and Industry and Electronics and IT outlined India's growth strategy, anchoring it in technology and trade as twin drivers of the next economic phase.
- India has been expanding its free trade agreement network rapidly — concluding FTAs with the UAE (2022), Australia (2022), UK, EFTA, and most recently the EU (January 2026), making the EU India's 22nd free trade partner.
- An India-US Interim Trade Agreement was described as a significant step, with tariffs reportedly reduced from 50% to 18% on key products.
- India's digital infrastructure expansion — including village-level network connectivity, semiconductor development, and AI ecosystem building — was highlighted as a key competitive advantage.
- The food processing sector was identified as a growth driver, with close to 40,000 registered agro-based processing units and emphasis on scaling up operations for global competitiveness.
Static Topic Bridges
India's Free Trade Agreement Architecture
India's approach to trade agreements has evolved significantly since 2014. The country has moved from cautious engagement (it withdrew from RCEP negotiations in 2019 citing concerns over Chinese imports) to proactive FTA expansion. India's trade agreements take different forms: Comprehensive Economic Partnership Agreements (CEPAs — with Japan 2011, South Korea 2010, UAE 2022), Comprehensive Economic Cooperation Agreements (CECAs — with Singapore 2005, Malaysia 2011), Early Harvest Schemes, and standard FTAs. Each type differs in coverage — CEPAs typically cover goods, services, investment, and trade facilitation, while CECAs may exclude services.
- India-UAE CEPA (May 2022): India's first comprehensive trade agreement in a decade; covers 97% of tariff lines, aims to increase bilateral trade from $45 billion to $100 billion
- India-Australia ECTA (December 2022): covers goods, services, rules of origin; full CECA under negotiation
- India-EFTA Trade and Economic Partnership Agreement (March 2024): covers Switzerland, Norway, Iceland, Liechtenstein; includes $100 billion investment commitment over 15 years
- India-EU FTA (concluded January 2026): India's largest FTA, covering over 99% of Indian exports by trade value; EU becomes India's 22nd free trade partner
- India-UK FTA: concluded alongside EFTA; covers goods, services, and investment
- Ongoing negotiations: GCC (Gulf Cooperation Council), bilateral investment treaties with Saudi Arabia, Qatar
Connection to this news: The emphasis on trade-driven growth reflects India's strategic pivot from import substitution towards active integration with major economic blocs — with the EU FTA representing the most significant milestone, potentially reshaping India's export composition and market access.
Production-Linked Incentive (PLI) Scheme — Driving Domestic Manufacturing
The Production-Linked Incentive Scheme, launched in March 2020, offers financial incentives (typically 4-6% of incremental sales) to companies manufacturing in India across 14 key sectors. The scheme aims to build domestic manufacturing capacity, reduce import dependence, and integrate India into global value chains. Total budgetary outlay across all 14 sectors is approximately Rs 1.97 lakh crore over 5 years.
- 14 sectors covered: mobile phones and electronic components, pharmaceuticals, medical devices, automobiles and auto components, telecom and networking, textiles, food products, white goods (ACs and LEDs), specialty steel, solar PV modules, advanced chemistry cell batteries, drones, semiconductors, IT hardware
- PLI for electronics: attracted investments exceeding Rs 8,000 crore; Apple suppliers (Foxconn, Pegatron, Wistron) set up major manufacturing in India
- PLI for semiconductors: separate India Semiconductor Mission (ISM) with Rs 76,000 crore outlay; Tata Electronics, Micron Technology setting up fabs
- Eligibility: based on incremental production/investment thresholds; incentives paid over 4-6 years
- Nodal ministry: Department for Promotion of Industry and Internal Trade (DPIIT), with sector-specific ministries as implementing agencies
Connection to this news: The reference to technology-driven innovative manufacturing and semiconductor development aligns directly with PLI's objectives — the scheme provides the industrial policy backbone for the government's vision of India as a global manufacturing hub alongside its digital economy strengths.
Digital Public Infrastructure (DPI) — India's Technology Stack
India has built a globally recognised Digital Public Infrastructure stack comprising identity (Aadhaar — 1.4 billion enrolments), payments (UPI — processing over 16 billion transactions monthly as of 2025), and data exchange (DigiLocker, Account Aggregator framework). This infrastructure underpins financial inclusion, digital governance, and the platform economy. The India Stack model has drawn international attention, with several countries exploring adaptation.
- Aadhaar: launched 2009, governed by Aadhaar Act 2016, managed by UIDAI; biometric and demographic identity for 1.4 billion residents
- UPI: launched 2016 by NPCI under RBI oversight; real-time interbank transfers; expanded internationally to Singapore, UAE, France, Sri Lanka
- BharatNet: optical fibre connectivity to all 6.4 lakh villages; aims to provide broadband access to gram panchayats
- IndiaAI Mission: Rs 10,372 crore allocation for developing AI compute infrastructure, datasets, and application development
- India AI Impact Summit 2026: scheduled in New Delhi (16-20 February 2026), positioning India as a global AI hub
Connection to this news: The emphasis on village-level connectivity and AI ecosystem development reflects the next phase of India's DPI strategy — moving beyond identity and payments to compute infrastructure, data governance, and AI applications that could drive productivity across agriculture, manufacturing, and services.
Key Facts & Data
- India's FTA partners: 22 (with the EU FTA conclusion in January 2026)
- India-EU FTA: covers over 99% of Indian exports by trade value
- India-UAE CEPA (2022): targets $100 billion bilateral trade (from $45 billion)
- India-EFTA: $100 billion investment commitment over 15 years
- India withdrew from RCEP in November 2019
- PLI Scheme: 14 sectors, total outlay approximately Rs 1.97 lakh crore
- India Semiconductor Mission: Rs 76,000 crore outlay
- UPI transactions: over 16 billion per month (2025)
- Registered agro-processing units: approximately 40,000
- IndiaAI Mission allocation: Rs 10,372 crore