India's Shift towards Bilateral Agreements
In a recent address at the Business Standard Manthan, Union Finance Minister Nirmala Sitharaman emphasized the growing significance of bilateral negotiations and agreements for India, considering the decline of multilateralism.
Reasons for Emphasizing Bilateral Deals
- Multilateralism is perceived as less effective, necessitating India's focus on bilateral deals in trade, investment, and strategic relations.
- India aims to prioritize its national interests through these bilateral engagements.
Global Context and Challenges to Multilateralism
- Populist movements globally have questioned the foundational principles of globalization and the international order established post-World War II.
- Concerns over China's influence in international institutions like the World Health Organization and hidden subsidies affecting global trade fairness.
- The United States, under Donald Trump, withdrew from key agreements like the Paris Agreement on climate change, weakening the WTO's effectiveness.
India's Strategic Response
- Engagement in plurilateral institutions like the Multi-Party Interim Appeal Arbitration Arrangement at the WTO to simulate multilateral frameworks.
- Enhancing capacity and resources for comprehensive bilateral negotiations.
- Streamlining interdepartmental processes to reduce negotiation delays.
- Making targeted concessions to ensure successful bilateral negotiations.
The EU-India Free Trade Agreement (FTA)
- The EU-India FTA serves as a critical test for India's commitment to enhancing bilateral relations.
- There is a focus on achieving the deal by the end of the year, necessitating high-level political commitment and energy.
In conclusion, embracing bilateral trade agreements is essential for India in the current international scenario, requiring strategic concessions and proactive engagement.
