India’s global trade strategy is at a crossroads. This article presents a fresh, future-ready framework — SMART- FTA (Free Trade Agreement) — that reimagines free trade not as a diplomatic checkbox, but as a dynamic, data-governed system.

It speaks to India’s current trade realities (from Non-Tariff Barriers to deficits), anticipates post-FTA disruptions, and proposes a uniquely Indian approach to resilience and reciprocity in trade agreements.

Designed for policy thinkers, trade practitioners, and institutional readers, this piece offers both vision and actionable architecture. The ideas here are meant not just to provoke discussion, but to inform the next phase of India’s trade doctrine.

Building Treaties that Perform, Not Just Promise

India’s experience with Free Trade Agreements (FTAs) has been shaped by a mix of ambition and frustration. Agreements such as CEPA with Japan, or those with ASEAN and Korea, were signed with hope for deeper integration and export gains. Yet, outcomes often fell short: imports surged, non-tariff barriers (NTBs) persisted, and trade deficits widened. The results were not catastrophic, but neither were they transformative.

These treaties were crafted for a different global order — one that assumed steady liberalisation, institutional trust, and shared growth. That order is now giving way to something far more fragmented and competitive.

The Old World of FTAs Is Gone

FTAs originated in an era when liberalisation was a shared goal and multilateralism provided the scaffolding for cooperation. But today, even the traditional champions of open trade — the US, EU, UK, and Canada — are rethinking their approach. Green subsidies, local sourcing rules, strategic stockpiles, data restrictions, and industrial policy have returned to centre stage.

Trade policy is no longer only about market access. It’s about resilience, reciprocity, and real-time advantage.

What used to be negotiated in broad strokes now demands precision. And what used to be governed by trust increasingly depends on technology and proof.

In this new landscape, India cannot afford to rely on legacy trade models. The challenge is not to walk away from FTAs, but to reimagine them — with tools that fit today’s realities.

“Treaties must behave like software — live, monitored, and patched — not like plaques on a wall.”

This isn’t just cyclical turbulence. It’s a paradigmatic shift. Trade now means trust, technology, and tactical alignment — not just market access. And if India keeps playing by old scripts, it risks being cast in roles that no longer matter.

SMART-FTA is not a Reform, It’s a Reboot

It stands for Strategically Managed, Algorithmically Rebalanced Treaties — a forward-looking framework that turns treaties into dynamic systems of delivery, not static statements of intent.

In essence, SMART-FTA proposes that FTAs should behave like live infrastructure — monitored, adjusted, and recalibrated over time. They should not be final words, but evolving systems embedded with India’s sectoral strengths, strategic needs, and digital capabilities.

It doesn’t just ask “What are we giving?” — it asks “What are we building?”

It’s a shift from treaty as promise to treaty as performance.

S – Sector- Calibrated FTA Design

India has outgrown template treaties. It needs a blueprint of its own.

Each treaty must focus on where India holds a distinct edge. Using analytical tools like Revealed Comparative Advantage (RCA), Trade Intensity Index (TII), and Export Sophistication Index (EXPY), negotiators can design sector-first treaties. For example:

• A Life Sciences corridor with the UK, focused on joint innovation and R&D
• A Textile–Leather value chain agreement with Africa, aligned with ethical sourcing
• An EV–Electronics pact with ASEAN, integrating Production Linked Incentives i.e. PLI-linked manufacturing zones

Just as Vietnam restructured its IP and customs laws before finalising its European Union FTA, India must also ensure treaties are preceded by institutional preparedness and domestic capacity building, especially for MSMEs.

M – Mechanism for NTB Detection and Discipline

If tariffs are dragons, NTBs are ghosts — and they must be brought into the light.

India has often faced invisible trade barriers — hygiene standards for rice in the EU, labeling objections on pharmaceuticals in Korea, or repeated customs delays in Japan.

SMART-FTA proposes:

• A dedicated NTB chapter with pre-defined bans, pre-notification rules, and 60-day response windows
• A real-time NTB Dashboard, linked to the DGFT, where exporters can flag market access issues.
• Use of AI to detect patterns, like abnormal rejection rates, altered testing protocols, or procedural lags.

The idea is simple: if a pattern of denial emerges, the treaty must respond, not years later through diplomatic backchannels, but within weeks, with data-backed action.

“Trust today isn’t built by handshakes — it’s built by dashboards.”

SMART-FTA promotes standards equalization-mutually recognized testing labs, shared digital certificates and compliance linked corridor access.

A – AI-Enabled Balance of Trade Monitoring

“Trade deficits shouldn’t be a post-mortem. They should be a trigger.”

India’s treaties need to include Balance of Trade (BoT) trigger clauses — automatic reviews if trade imbalances exceed a threshold over a given period.

To address persistent deficits, SMART-FTA can introduce Smart Trade Balancing Credits (STBCs) — obligations on the partner country to:

• Prioritise Indian bids in public procurement
• Enable co-production or technology sharing
• Offer liberalised service access (e.g., visa quotas, fast-tracked licensing)

All of this can be monitored through a live digital dashboard combining customs and GSTN data, enabling continuous tracking and early warning.

R – Resilience-Built, Review-Ready Treaties

“A treaty that doesn’t evolve becomes a liability.”

In a volatile world, flexibility is a feature — not a flaw.

SMART-FTA makes treaties modular and reviewable, not frozen. Some clauses — such as on digital services, e- commerce, or data flows — could be implemented only after readiness checks or sandbox trials.

Treaties would include five-year review mandates, while a Trade Resilience Index simulates scenarios like:

• Raw material shortages
• Sanctions or war-time disruptions
• Public health emergencies

The aim is to build adaptive architecture — not just liberalise for today, but prepare for tomorrow.

T – Transparent, Tech-Driven Enforcement

Trust is earned through transparency — and delivered through data. SMART-FTA envisions:

• A Unified Trade Dashboard, openly tracking treaty outcomes, tariffs, NTBs, and trade deficits
• An AI-powered Trade Treaty Intelligence System (TTIS), using customs Electronic Data Interchange (EDI) and blockchain tags to detect violations or underperformance
• Annual FTA Scorecards, co-authored with think tanks and business chambers — to publicly measure and verify treaty impact

If the public can’t see what an FTA is doing, it becomes difficult to defend or improve. SMART-FTA brings governance into the open.

If trade is about national interest, then treaties must serve performance over optics.

Placing Services, IP, and Skilling at the Centre of SMART-FTAs

India’s services sector often gets sidelined in manufacturing-heavy FTAs. SMART-FTA introduces phase-wise services chapters — backed by skill certification protocols, mutual recognition of digital services, and “Skills Passports” to facilitate cross-border delivery.

Intellectual Property chapters are structured around conditional reciprocity, with trial clauses, rather than irreversible commitments. On skilling, treaties require partner investments in training centers, tech transfers, or workforce upskilling aligned with India’s PLI and Gati Shakti initiatives.

The Anti-Dumping Assurance

Domestic manufacturers fear FTAs for one reason: dumping. SMART-FTA incorporates real-time safeguard triggers. If imports surge beyond a threshold, automatic floor reviews are triggered. Sensitive sectors can invoke “harm flags” using trade data and invoke pause-and-review clauses without WTO violation.

“SMART-FTA is not about slowing trade. It’s about making trade work”.

Beyond FTAs: The Post-Treaty World

The world is moving beyond grand FTAs to targeted, resilient partnerships. India must get ahead of this shift by piloting new models:

• Strategic Trade Compacts (STCs): Like a nuclear-tech pact with France or a green hydrogen alliance with Germany — narrow, high-value, and built on urgency
• Trust-Based Trade Corridors (TTCs): Like the India–UAE food corridor — governed not by geography, but by blockchain-led verification
• Sovereign-Compatible Trade Systems (SCTS): Where India retains flexibility to invoke safeguards — similar to Indonesia’s palm oil mechanism
• Digitally Governed Agreements: Where real-time compliance data triggers enforcement, reducing reliance on legal tribunals

SMART-FTA is the stepping stone to this next frontier.

Managing the Transition: Cooling the Nerves, Strengthening the Argument

The recent conclusion of the India–UK FTA reflects India’s willingness to engage with the world on its terms. SMART-FTA does not contradict such momentum — it builds on it.

Signed agreements like those with the UAE, Australia, or Mauritius can evolve to adopt SMART principles — through dashboards, AI-monitoring, and modular updates.

Ongoing negotiations — such as those with the EU or EFTA — can use SMART tools to sharpen sectoral focus, embed resilience, and increase public accountability.

And for those who oppose FTAs altogether, SMART-FTA is not an argument for more deals — it’s a demand for better ones. It formalises caution into design, and converts discipline into enforceable architecture. For these sceptics SMART is not a sellout, it is a strategic filter- ensuring no treaty survives without proving its worth.

A First-of-Its-Kind Framework

What makes SMART-FTA globally unique is its integrated architecture. While parts of this model — like modularity, transparency, or NTB redress — have been tested elsewhere, no country has yet combined algorithmic governance, AI-enforced trade balancing, NTB detection, and sovereign-compatible design into a single FTA strategy.

Individual ideas may exist — in Vietnam’s readiness, Singapore’s digital corridors, or the EU’s standards power — but India’s SMART-FTA is the first systemic integration of all these tools. This is not an adaptation of global best practices. It is an original concept, built from India’s realities and possibilities.

“India has outgrown template treaties. It needs a blueprint of its own.”

Conclusion: India’s Strategic Choice

We can continue with template FTAs — slow to deliver, hard to enforce. Or we can pioneer a smarter path. SMART-FTA puts strategy before sentiment. Enforcement before expectation. Performance before promises. In a world shaped by disruption, the nations that build resilient trade systems will lead. India must not wait for the global order to stabilise. India must help shape the new order by inventing it.

On June 10, 2025, in Bern, Commerce and Industry Minister Piyush Goyal announced that India and the 27-nation European Union are “really very near” to concluding a comprehensive Free Trade Agreement. With negotiations revived in June 2022 after a nine-year pause, only a few issues remain. As India moves closer to formalising one of its most significant trade pacts, this milestone reinforces the urgent need for a smarter, performance-led approach to treaty-making — precisely what frameworks like SMART-FTA are designed to address.

(The paper is the author’s individual scholastic articulation. The author certifies that the article/paper is original in content, unpublished and it has not been submitted for publication/web upload elsewhere, and that the facts and figures quoted are duly referenced, as needed, and are believed to be correct). (The paper does not necessarily represent the organisational stance... More >>