By Sanskriti Global Exports by Himanshu Gupta

Navigating the Headwinds: Policy Shifts, FTA Progress, and the Path Forward for Indian Trade

October 24, 2025 – In the dynamic world of international trade, standing still is moving backward. This week’s developments underscore this reality for Indian import-export professionals. A complex tapestry of promising policy interventions, significant strides in trade negotiations, and sobering macroeconomic data has been woven, demanding careful analysis from every stakeholder in the value chain. From a landmark breakthrough in the long-negotiated India-EU Free Trade Agreement (FTA) to the strategic expansion of the Production Linked Incentive (PLI) scheme into a crucial green energy sector, the signals from New Delhi are clear: the focus is on building resilience, enhancing competitiveness, and capturing new markets. However, preliminary export figures for the first half of the fiscal year serve as a stark reminder of the persistent global headwinds. As your trusted trade advisor, let’s dissect these events and translate them into actionable intelligence for your business.

The Daily Roundup: A Factual Summary

This week’s trade news was dominated by several key announcements and data releases that will shape the commercial landscape for months to come.

1. India-EU FTA Sees Breakthrough on Technical Barriers to Trade (TBT): Sources close to the negotiations in Brussels have confirmed a significant breakthrough in the India-EU FTA talks. The two sides have reportedly reached a provisional agreement on a framework for mutual recognition of standards and certifications for a range of engineering goods, particularly in the automotive components and industrial machinery sectors. This has been a major sticking point for years, with Indian exporters often facing costly and time-consuming re-certification processes to meet EU standards. The proposed framework aims to streamline this, accepting Indian certifications (from accredited bodies) as equivalent, thereby reducing non-tariff barriers.

2. Government Expands PLI Scheme to Green Hydrogen Electrolysers: In a major push for its green energy ambitions and high-value manufacturing, the Union Cabinet has approved the inclusion of Green Hydrogen electrolysers under the flagship PLI scheme. With an initial outlay of ₹25,000 crore over five years, the scheme aims to incentivise domestic manufacturing of these critical components. The goal is to make India a global manufacturing hub for electrolysers, catering to both domestic demand and export markets as the world transitions to cleaner energy sources.

3. 'GatiShakti ULIP 2.0' Portal Goes Live: The Ministry of Commerce and Industry officially launched the second iteration of its Unified Logistics Interface Platform (ULIP) under the PM GatiShakti National Master Plan. Dubbed 'ULIP 2.0', the new portal integrates real-time data from shipping lines, port terminals, and the Central Board of Indirect Taxes and Customs (CBIC). Its primary objective is to drastically improve container tracking and reduce dwell times at major ports like JNPT and Mundra, with a stated target of bringing average container turnaround time below 48 hours.

4. Commerce Ministry Data Indicates Tepid Export Growth: Preliminary data released by the Commerce Ministry for the first half of the fiscal year (April-September 2025) paints a challenging picture. Merchandise exports grew by a modest 4.5% year-on-year, falling short of the double-digit growth targets. The slowdown is attributed to weak demand from key markets in North America and Europe, coupled with increased competition from other Southeast Asian economies. Electronics, pharmaceuticals, and petroleum products remained bright spots, while sectors like textiles and gems & jewellery faced significant pressure.

Implications for Indian Import-Export Professionals

Understanding these developments is one thing; leveraging them for competitive advantage is another. Here are the direct implications and strategic considerations for your business:

• For Engineering Exporters (Especially to the EU): The FTA breakthrough is a potential game-changer. You must immediately begin to align your internal quality control and certification processes with the NABL-accredited bodies that will be part of the mutual recognition agreement. Proactively engage with your European buyers to inform them of this development, as it could significantly lower their landed cost and simplify their procurement process, making your products more attractive. This is the time to invest in upgrading quality standards to be 'EU-ready' before the ink on the final deal is even dry.
• For MSMEs in Manufacturing: The PLI scheme for electrolysers isn't just for large corporations. It will create a massive downstream demand for precision components, specialised alloys, control systems, and power electronics. If you are in the business of manufacturing pumps, valves, instrumentation, or fabricated metal products, this is a clarion call to explore diversification. Study the technical requirements of electrolyser manufacturing and begin outreach to the potential large players who will be setting up plants.
• For Logistics and Supply Chain Managers: The 'GatiShakti ULIP 2.0' is not just another government portal. It is a tool for cost reduction and enhanced predictability. Your immediate task is to ensure your logistics teams and freight forwarders are trained and fully integrated with this platform. The real-time data it provides can be used to optimize inventory management, reduce buffer stocks, and negotiate better terms with transporters by leveraging data-backed insights on transit times. This can directly impact your bottom line by reducing demurrage and detention charges.
• For All Exporters (A Call for Diversification): The tepid export growth figures are a clear signal that over-reliance on traditional Western markets is a high-risk strategy. The data compels a renewed and aggressive focus on market diversification. It is imperative to explore and build relationships in high-growth regions like ASEAN, the Middle East (especially the GCC countries), and Latin America. Utilize government schemes like the Market Access Initiative (MAI) to participate in trade fairs and conduct market studies in these regions. Your survival and growth depend on finding new customers in new geographies.

Conclusion: Agility in an Evolving Landscape

The developments of October 24, 2025, present a dual reality for India's trading community. On one hand, proactive government policies and diplomatic successes are actively working to dismantle barriers and create new, high-value opportunities. The moves on the EU FTA and the Green Hydrogen PLI are forward-looking strategies designed to secure India's place in global value chains of the future. On the other hand, the macroeconomic reality of sluggish global demand cannot be ignored. The path to sustained growth is no longer about simply producing and shipping; it is about strategic alignment. The successful Indian trader of tomorrow will be the one who leverages digital logistics tools to trim costs, diversifies their market portfolio to mitigate risk, and invests in the quality and capabilities needed to compete in a more demanding global arena. The landscape is challenging, but for the informed and agile, the pathways to growth are becoming clearer.

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