Trade deals with US and EU near finalisation, says India’s FM

Trade deals between India and the United States and the European Union are likely to be concluded soon, according to Union Finance Minister Nirmala Sitharaman, who pledged government support for exporters amid the challenging global environment.

“Intense trade negotiations are going on with the US and the European Union and should come to a conclusion sooner. Emphasis is being made on getting more free trade agreements signed,” Sitharaman said at Exim Bank’s Trade Conclave 2025 in New Delhi.

The finance minister pointed out that India’s total exports have touched an all-time high of $825 billion – a 6% growth over the previous year – despite difficult global trading conditions. “This is a significant leap of $466 billion over 2013–14,” she added.

Sitharaman acknowledged the continuing success of Indian exporters, saying: “I appreciate the Indian exporters putting in that kind of an effort, that they are still growing and are finding real success.”

The Finance Minister highlighted the fact that global trade was declining, with institutions such as the Organisation for Economic Co-operation and Development (OECD) and the World Bank projecting a fall-off. “Global growth in trade has suffered,” she said, adding that Indian exporters were “swimming against the current” despite the odds.

Her comments come at a time when India is looking to deepen its export base while navigating an uncertain global economic climate brought about by US President Donald Trump’s tariffs and broader geopolitical uncertainties.

Sitharaman reiterated the government’s commitment to supporting exporters through improved access to finance and structural reforms. “The government will give all support to exporters. Every year we have had serious challenges in global trade,” she said.

She pointed out that while global exports grew at 4%, India’s exporters managed a 6.3% growth,” she added.

Sitharaman pointed to the major steps the Indian government has taken to support exporters. “The first one is transport and logistics upgrades, which improve supply chain efficiency. Secondly, the government has provided targeted support to MSMEs. Third of the five is trade finance access,” she said.

Leading analyst expects India’s economy to grow at 6.5% in FY2026

S&P Global Ratings has revised India’s GDP growth forecast for the current fiscal year (FY26) upward to 6.5%.

This revision brings S&P’s projection in line with the Reserve Bank of India (RBI) prediction, which has forecast 6.5% growth for the financial year ending March 2026.

In its Asia-Pacific Economic Outlook report, S&P said India remains resilient to global shocks due to strong domestic demand and its relatively low exposure to goods exports.

“We see India’s GDP growth holding up at 6.5% in fiscal 2026. That forecast assumes a normal monsoon, lower crude oil prices, income-tax concessions and monetary easing,” the rating agency said.

In May, S&P had trimmed India’s FY26 forecast by 20 basis points to 6.3%, citing global uncertainties and the potential impact of higher US import tariffs.

S&P also flagged rising economic risks from the escalating conflict in the Middle East, especially if it leads to sustained high oil prices. The agency noted that such a situation could severely impact Asia-Pacific economies, including India, by slowing global growth and increasing the burden on net energy importers.

India is particularly vulnerable, as it imports nearly 90% of its crude oil and buys about half of its natural gas from international markets.

However, S&P played down fears of long-term disruptions, saying “Current conditions on global energy markets – which are well-supplied – make such long-term impact on oil prices unlikely.”

S&P also warned that the US tariff increases and the uncertainty surrounding them could hurt global trade, investment and growth, further compounding the risks to the global economic recovery.