ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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A Quantitative Assessment of the EU–India Free Trade Agreement

With EU–India clinching a post-Brexit trade negotiation, the present paper proposes to examine whether the free trade agreement between the two regions would increase production efficiency and thereby social welfare. Using the partial equilibrium model, the study reveals that the EU–India FTA yields less positive trade and welfare gains in India after Brexit specifically, for consumer, industrial, and capital goods, whereas it would still be in India’s interest towards the specific benign impact of an FTA in raw materials, intermediate goods, and agricultural goods. From the policy perspective, India is not well-served by its pursuit of protectionist agenda and instead should push for trade liberalisation as a better path for the global trading system.

Is There Any Dichotomy between India’s New FTA Strategy and Its Trade Policy?

India’s recalibrated free trade agreement strategy lacks appropriate coherence to its trade policy that vouches for domestically produced goods over imported goods. The increased proclivity towards signing the free trade agreements is more driven by its geostrategic interests and prominently addressing the supply-chain vulnerabilities.

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