Mumbai, Feb 20: India’s free trade deals with the European Union and the US are likely to play a significant role for the economy in the coming years, as foreign portfolio investments and the rupee staged a comeback post the two announcements, the RBI’s bulletin said on Friday.
An article published in the Reserve Bank’s February bulletin also emphasised that the domestic economy remained resilient, with quarterly results of listed private companies showing strengthening of aggregate sales growth.
Industrial activity remained strong, and the services sector sustained its healthy growth.
The Union Budget 2026-27 reaffirmed the government’s commitment to fiscal consolidation without diluting the focus on long-term growth, with stepped-up allocation towards capital expenditure, said the article on the state of the economy.
The completion of the India-EU free trade negotiations at the end of January and the subsequent interim trade agreement between India and the US are likely to play a significant role in the coming years by improving market access, enhancing export competitiveness, and integrating Indian firms more deeply into global value chains, it said.
“In the immediate term, it has led to a change in investor sentiments. Foreign portfolio investment into the equity and debt segment staged a comeback in February,” it added.
India concluded landmark deals with two of its major trading partners within a month. India and the EU concluded a free trade agreement on January 27.
The interim trade deal with the US was announced on February 7. (PTI)
