India has initiated trade negotiations with the Philippines and Maldives, focusing on a preferential trade agreement and a free trade agreement to boost economic ties.

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•  India has signed Terms of Reference with the Philippines and Maldives to begin negotiations for new trade agreements aimed at strengthening bilateral economic cooperation.
•  India and the Philippines will negotiate a Preferential Trade Agreement, which focuses on reducing or eliminating tariffs on selected goods to enhance trade competitiveness.
• Trade between India and the Philippines has grown steadily, with India’s exports rising to about 2.16 billion dollars, while imports declined significantly in recent data.
•  India has also initiated talks with the Maldives for a comprehensive Free Trade Agreement covering a wider range of goods, services, and investment regulations.
•  Unlike PTA, the proposed Free Trade Agreement with Maldives aims to remove tariffs on most traded goods and simplify rules for services and investments.
•  Recent trade data shows India’s exports to Maldives declined, while imports increased, highlighting the need for a more balanced and structured trade framework.
•  A Preferential Trade Agreement provides limited tariff reductions on selected products, offering targeted trade benefits between partner countries.
•  A Free Trade Agreement is broader and deeper, covering most goods and services, promoting long-term economic integration and stronger bilateral trade relations.