Escalating geopolitical conflicts across West Asia and Eastern Europe have slowed negotiations on three major Free Trade Agreements (FTAs) that India is pursuing with the Gulf Cooperation Council (GCC), Israel, and the Eurasian Economic Union (EAEU). Together, these trading partners account for nearly US$243 billion in annual bilateral trade with India—approximately 20% of the country’s total global trade.
Government officials said that while technical discussions continue, the conflicts have disrupted scheduled negotiation rounds, delayed official visits and complicated diplomatic engagement, slowing progress on agreements considered strategically significant for India’s trade expansion.
Three Major FTAs Impacted
The affected negotiations include trade agreements with:
- Gulf Cooperation Council (GCC) nations
- Israel
- Eurasian Economic Union (EAEU)
Collectively, these economies represent one of India’s largest trading blocs outside its existing FTA network.
India’s Trade with the Three Regions
| Trade Partner | Total Annual Trade |
|---|---|
| GCC Countries | US$178.7 billion |
| EAEU | US$60.7 billion |
| Israel | US$3.9 billion |
| Total | US$243.3 billion |
The combined trade accounts for roughly 20% of India’s overall merchandise trade, making these negotiations economically significant.
GCC Talks Delayed by West Asia Tensions
India had planned to begin formal negotiations for a comprehensive FTA with the Gulf Cooperation Council, comprising:
- Saudi Arabia
- United Arab Emirates
- Qatar
- Kuwait
- Oman
- Bahrain
However, following the escalation of hostilities involving the United States and Iran, the scheduled first round of negotiations has yet to take place.
Officials described the GCC agreement as strategically important, not only because of trade volumes but also because it would significantly improve market access across the Gulf region.
According to government sources, securing an agreement with the GCC would enable Indian exporters to access multiple Gulf markets more efficiently through interconnected regional trade networks and ports.
India-Israel Negotiations Also Slowed
Trade discussions with Israel have similarly faced delays due to the security situation in the region.
The Terms of Reference (ToR) for the proposed India-Israel FTA were signed in November 2025 by Union Commerce and Industry Minister Piyush Goyal and Israel’s Economy Minister Nir Barkat.
Following the first round of negotiations held in New Delhi in February 2026, the second round was scheduled to take place in Tel Aviv in May.
However, deteriorating regional security conditions forced changes to the negotiation schedule and venue.
Instead of Indian officials travelling to Israel, the Israeli negotiating team is currently in New Delhi to continue discussions through July 23.
Government officials cited safety concerns as the primary reason for altering the planned schedule.
Ukraine Conflict Slows EAEU Discussions
Negotiations with the Eurasian Economic Union (EAEU) have also experienced delays due to the ongoing conflict involving Russia and Ukraine.
The EAEU comprises:
- Russia
- Belarus
- Kazakhstan
- Armenia
- Kyrgyzstan
The first round of negotiations was held in November 2025, while the second round took place in Moscow in June 2026, several months later than initially expected.
Officials said technical and virtual discussions continue to make progress, but organising in-person meetings has become increasingly difficult as military developments in the region continue.
Strategic Importance for India
These proposed FTAs are viewed as important components of India’s broader trade diversification strategy.
Successful agreements could:
- Expand export opportunities.
- Improve market access for Indian businesses.
- Strengthen supply chain integration.
- Reduce trade barriers.
- Enhance economic cooperation with strategically important regions.
The GCC agreement, in particular, is expected to be significant because of the Gulf’s role as one of India’s largest trading partners and a key destination for Indian exports.
Trade Diplomacy Continues Despite Delays
Although geopolitical instability has slowed the pace of formal negotiations, government officials indicated that back-end discussions and technical consultations continue wherever possible.
Once regional security conditions improve, negotiators are expected to accelerate talks to conclude agreements that could substantially enhance India’s global trade footprint.
With nearly one-fifth of India’s international trade linked to these three regions, the progress of these FTAs will remain closely watched by exporters, investors and policymakers.
Disclaimer: This report has been editorially prepared using publicly available information and official government sources. Readers are advised to refer to official announcements from the Government of India and partner countries for further updates on FTA negotiations.
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