This huge protection advantages key export sectors for least developed nations (LDCs)—comparable to espresso, tea, leather-based, textiles and processed meals—serving to these economies combine extra successfully into international worth chains.
Based on the WTO secretariat’s newest report, Market Entry for Merchandise and Companies of Export Curiosity to Least Developed Nations, India’s Responsibility-Free Tariff Choice (DFTP) Scheme covers 94.1% of tariff traces, rating among the many broadest market entry programmes provided by any growing nation to least developed nations. Launched in 2008, the scheme displays India’s long-standing dedication to South-South cooperation and inclusive regional development.
The WTO report has credited the DFTP scheme for considerably boosting exports from least developed nations, significantly these in Asia and Africa, aligning with New Delhi’s Neighbourhood First and Act East insurance policies.
The report, offered on 3 October, notes that India presents one of many highest preferential margins globally, averaging 15.1 share factors throughout all merchandise and 29.7 share factors for agricultural items.
India additionally stands out because the fifth-largest export vacation spot for LDCs, accounting for six.8% of complete LDC exports in 2024, behind solely China (25%), the European Union (17%), the United Arab Emirates (12%), and the US (9%).
Based on the report reviewed by Mint, LDC exports to India had been valued at $21.5 billion in 2024, primarily pushed by minerals, agricultural commodities, and textiles, which additionally help India’s home industries.
Key Takeaways
- India’s Responsibility-Free Tariff Choice (DFTP) Scheme covers 94.1% of tariff traces for Least Developed Nations (LDCs), making it one of many broadest market entry programmes provided by any growing nation, surpassing China and the European Union.
- The WTO credit the scheme for considerably boosting LDC exports, significantly in Asia and Africa, aligning with India’s Neighbourhood First and Act East insurance policies.
- India presents a excessive common preferential margin of 15.1 share factors throughout all merchandise, rising to 29.7 share factors for agricultural items, which immediately advantages sectors comparable to espresso, tea, and textiles.
- India is the fifth-largest export vacation spot for LDCs, accounting for six.8% of their complete exports, valued at $21.5 billion in 2024.
- Specialists view the DFTP scheme as a device that enhances India’s regional affect and builds its long-term credibility as a principal commerce and developmental accomplice within the World South, contrasting with China’s resource-driven mannequin.
Easy accessibility
Globally, LDC exports have grown at a mean annual fee of 6.7%, reaching $277 billion in 2024, in accordance with WTO knowledge. The report highlights that India’s duty-free framework presents a considerable increase to this commerce by decreasing tariff limitations and fostering equitable participation in international markets.
Together with Korea and Montenegro, India is among the many few growing members offering over 90% duty-free entry to LDC exports, whereas developed members comparable to Australia, New Zealand, Norway, and Switzerland provide full 100% protection, as per the WTO doc.
It additional described India’s contribution as important to making sure that poorer economies profit from the enlargement of multilateral commerce.
The DFTP scheme at the moment advantages 35 least developed nations, together with Bangladesh, Nepal, Bhutan, Myanmar, Tanzania and Ethiopia—nations that share rising commerce linkages with India. The WTO famous that India’s method displays a balanced technique combining commerce facilitation with developmental partnership, a cornerstone of its Neighbourhood First and Act East insurance policies.
Specialists say India’s programme not solely helps LDC economies but in addition enhances its personal regional affect at a time when international commerce is turning into extra fragmented. “India’s management in offering actual, measurable entry to LDCs contrasts sharply with China’s resource-driven engagement mannequin,” mentioned a former WTO negotiator. “It builds long-term credibility for India because the principal commerce accomplice of the World South.”
“India was the primary growing nation to supply broad preferential tariff entry to least developed nations, fulfilling its WTO commitments and serving to combine LDCs into international commerce,” mentioned Vinod Kumar, president of the India SME Discussion board. “With imports price over $10 billion yearly from 36 of the 46-plus LDCs, the DFTP scheme has positioned India as a serious export vacation spot for LDC merchandise, supporting financial development in accomplice nations and strengthening our position as a key driver of South-South cooperation,” mentioned Kumar.
Daring transfer
“India was the primary growing nation to totally implement the WTO Ministerial choice to supply obligation free-quota free market entry to the LDCs in 2008. This was a daring step, given India’s personal developmental wants and the vulnerability of the sectors wherein the LDCs sometimes commerce, comparable to agriculture,” mentioned Agneshwar Sen, Commerce Coverage chief, EY India.
“At the moment, India’s Responsibility-Free Tariff Choice scheme extends preferential entry to nearly 98% of tariff traces, making India’s product protection one of many widest, even when in comparison with some developed nations. What is absolutely vital is that India offers this non-discriminatory market entry to all LDCs with none political motivations or quid professional quo. Thus, asserting India’s dedication to equitable improvement of all within the World South,” mentioned Sen.
