New Delhi: In a sharp take down of trade negotiations during the UPA government, Prime Minister Narendra Modi on Sunday said its "economic mismanagement" left India unable to negotiate from a position of confidence and could never conclude any talks.
In an exclusive interview with PTI, Modi said India's deals signed with Australia, New Zealand, the UK, the EU, and the US have opened access for MSMEs, particularly in labour-intensive sectors, to export to these regions with near-zero tariffs or tariffs much lower than those of other exporting countries.
"These trade agreements may have happened recently, but they are the outcome of a more competitive domestic industry, a confident approach and an open outlook. These are rare qualities in today's world. Before we speak of India's successful trade agreements in recent years, it is important to recall where we stood just over a decade ago," the prime minister said.
During the years of the UPA government, they tried to secure some trade deals, and yet the journey was marked by "uncertainty and inconsistency", Modi said.
"Largely because their economic mismanagement left India unable to negotiate from a position of confidence. They did not lay the environment to bring negotiations to a conclusion. Talks would begin and then break down. In the end, despite prolonged negotiations, very little of real substance was achieved," he said, hitting out at the Manmohan Singh dispensation.
"But once we came in, we led an economic resurgence through our policy-driven governance, strengthened our economic fundamentals and created a rules-based system. When we ensured political stability, policy predictability and a reform-oriented approach, the world wanted to invest in India," he asserted.
Modi said his government's reforms helped both India's manufacturing and service sectors and encouraged productivity and competitiveness among MSMEs.
As a confident, competitive and fast-growing economy, many nations saw the benefits of pursuing trade agreements with India, he said.
"To understand the difference between the earlier approach and ours, consider the EU trade agreement. It was discussed and negotiated even under the previous government. But it was our government which eventually sealed a win-win deal for our economies," the prime minister said in a written interview.
Over the last few years, he said his government has built a strategic and purposeful network of Free Trade Agreements.
"We now have FTAs with 38 partner nations, an unprecedented milestone in India's trade history. A remarkable feature of these trade agreements is that they span continents and include countries of varying economic strength. This gives our manufacturers and producers enough diversity and depth to sell our products across many markets," Modi said.
These FTAs have opened up the markets of major economies to India's manufactured products, Modi said and cited the example of the India-UK FTA and the India-EU FTA that will eliminate tariffs on 99 per cent of India's exports to these countries.
He pointed out that merchandise trade with both Australia and the UAE has doubled since the signing of FTAs with these countries.
"Our service sector and its professionals are well known worldwide. They have already made India a hub of Global Capability Centres in different domains. These trade agreements have further boosted their opportunities with greater regulatory certainty, mutually beneficial frameworks and greater mobility across our partner nations," he said.
The country's manufacturing sector has been taking "giant strides" in over the past few years and these trade agreements will help integrate India and Indian products more deeply into global supply chains, he asserted.
"They will give better returns to Indian producers and manufacturers and also contribute to increasing prosperity for our people. The trade agreements of the past few years have come at a historic and opportune time for both our manufacturing and service sectors.
"They are creating a huge number of opportunities for our youth. I am confident that they will make an impact on the world with the quality and competitiveness of our goods and services," he said.
Modi further said that once Indian youth make an impact on the minds of the common people of partner nations, there will be no looking back.
"These trade agreements are significant not merely because of tariff reductions but because of supply-chain integration and market access in advanced economies. They gradually liberalise manufacturing tariffs, deepen services integration and create new avenues for labour-intensive exports such as textiles, footwear, electronics and engineering goods," he said.
In that sense, they support structural transformation rather than simply boosting headline trade numbers, he added.
"These FTAs also anchor domestic reform to external commitments. They widen export opportunities, reduce tariff disadvantages relative to competitors, and integrate Indian firms more deeply into global value chains. They reinforce India's transition toward becoming a more open, confident and globally engaged economy, aligned with the long-term vision of Viksit Bharat by 2047," Modi said.
Asked about MSMEs having featured prominently in the recent trade agreements, Modi said, "We are entering into these historic trade deals from a position of strength. The vision of Made in India has filled our MSMEs with new confidence and vigour."
Source Name : Economic Times