New Delhi: As the global trade landscape continues to face rising protectionism, India is set to intensify its efforts to diversify international trade partnerships in 2026, with plans to negotiate around a dozen bilateral free trade agreements (FTAs) and strengthen investment flows. Among the most significant of these deals are expected to be agreements with the European Union (EU), the United States, and the Russia-led Eurasian Economic Union (EAEU), representing some of the world’s largest economic blocs with a combined GDP exceeding $50 trillion.

According to a year-end review by the commerce and industry ministry, India will build on its momentum from 2025, when it successfully concluded three FTAs. The upcoming year’s negotiations aim not only to expand market access for Indian exporters but also to boost foreign direct investment (FDI) and deepen India’s integration into global value chains. The ministry noted that these agreements are intended to create mutually beneficial trade and investment ecosystems across diverse sectors, including manufacturing, technology, services, and agriculture.

The India-EU FTA, which has been in the advanced stages of negotiation, is expected to be formally announced in January 2026. High-level preparatory meetings have been scheduled ahead of an India-EU summit in New Delhi. The EU, the world’s second-largest economy with a GDP of $19.99 trillion, represents a substantial opportunity for Indian exporters in sectors such as pharmaceuticals, textiles, IT services, and engineering goods. Parallel negotiations with the US, the largest global economy with a $31.6 trillion GDP, are also at advanced stages, signaling a concerted push to strengthen bilateral trade ties with Washington.

In addition to these high-profile agreements, India plans to continue discussions with other strategic partners, including the EAEU, which includes Armenia, Belarus, Kazakhstan, Kyrgyzstan, and Russia, with a combined GDP of $2.4 trillion. Trade talks are also expected to progress with Australia under a Comprehensive Economic Cooperation Agreement, Chile, South Korea (with an upgraded negotiation framework), Peru, Sri Lanka through an Economic and Technology Cooperation Agreement, and the Maldives. Renegotiations with ASEAN countries—an economic bloc valued at over $4 trillion—will focus on trade in goods agreements to further expand regional engagement.

These initiatives come amid challenges in the global trade environment. The US imposed 50% additional duties on certain Indian goods from August 2025, while Mexico raised most-favoured-nation tariffs for countries without bilateral agreements. Indian officials have engaged with both countries to resolve these trade issues amicably while accelerating negotiations with alternative partners to mitigate risks associated with tariff volatility. Consultancy firm Dhruva Advisors noted that despite these headwinds, India has successfully maintained momentum in bilateral trade discussions, highlighting the resilience of its exporters.

Despite global economic turbulence, India’s merchandise exports demonstrated resilience in 2025. Between January and November, exports rose from $36.43 billion to $38.13 billion, reflecting growth across multiple product categories and markets. The ministry credited this performance to the strategic diversification of trade partners and the proactive engagement in FTAs, which help secure both market access and investment commitments.

Indeed, recent agreements have increasingly emphasized investment alongside trade liberalization. India’s FTA with New Zealand, announced on December 22, includes a $20 billion investment commitment over 15 years, while the FTA with the European Free Trade Association (EFTA) bloc—which includes Norway, Switzerland, Iceland, and Liechtenstein—became operational in October 2025 with a commitment of $100 billion in investments over the next 15 years. A ministry spokesperson highlighted that such agreements not only facilitate trade but also build trust between partners, making India a more attractive destination for foreign investment.

The broader trajectory of India’s FDI inflows underscores this appeal. From April 2000 to June 2025, India attracted a cumulative gross FDI of $1.1 trillion, with annual inflows rising from $36.05 billion in 2013-14 to $80.62 billion in 2024-25. Provisional figures for 2025-26, up to June, indicate FDI inflows of $26.61 billion, a 17% increase from the previous year. Over the past 11 financial years (2014-25), India attracted $748.38 billion in FDI, representing a 143% increase compared to $308.38 billion in the preceding 11-year period (2003-14). Notably, nearly 70% of total FDI inflows of $1,071.96 billion in the 25-year period from 2000-25 occurred between 2014-25, highlighting India’s emergence as one of the most attractive investment destinations globally.

Government officials and trade experts predict that India could successfully finalise three to four major FTAs in 2026, which would further consolidate its position in the global trade landscape. These agreements are seen as critical not only for market expansion but also for facilitating technology transfer, enhancing manufacturing competitiveness, and supporting domestic employment growth. In sectors such as electronics, renewable energy, pharmaceuticals, and IT services, FTAs are expected to catalyze new investments and provide Indian companies with a competitive edge in international markets.

The ministry also emphasised that FTAs serve as a strategic tool for economic diplomacy, strengthening India’s relationships with global economic powers. By securing both trade and investment commitments, these agreements are intended to create a stable environment for cross-border business operations, reduce reliance on any single market, and mitigate risks from global economic shocks or protectionist policies.

As India embarks on this ambitious agenda in 2026, officials remain cautiously optimistic. The combination of proactive negotiations, ongoing trade diversification, and strong FDI inflows underscores the government’s commitment to positioning India as a globally integrated and resilient economy. Observers note that successful implementation of these FTAs could have far-reaching implications, including increased employment, enhanced technology adoption, greater foreign investment, and sustained economic growth, while simultaneously strengthening India’s geopolitical and economic influence on the world stage.

In summary, India’s 2026 trade agenda will focus on negotiating approximately a dozen FTAs, with particular emphasis on agreements with the EU, US, and EAEU, alongside ongoing discussions with several other strategic partners. The dual focus on trade liberalization and investment commitments reflects India’s strategy to diversify its economic partnerships, secure new market opportunities, and attract substantial FDI, even amid global protectionist trends. With the country’s export performance remaining robust and its attractiveness as an investment destination rising, 2026 is poised to be a pivotal year for India’s international trade and economic engagement.