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India's trade pact dilemma

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A worker walks past a container ship at Mundra Port in the western Indian state of Gujarat.   © Reuters

Recent statements from officials show that Prime Minister Narendra Modi's government is not happy with the way India's trade agreements have performed in encouraging exports. The government thinks the country's trade pacts are generating more imports than exports, adding to the country's trade deficit.

India has been highly active in the trade arena in the last seven years, concluding agreements with South Korea, Japan and the Association of Southeast Asian Nations (ASEAN), as well as opening talks on pacts with the European Union and Canada. There is no evidence that such agreements are responsible for the country's poor export performance, but India certainly needs to improve its poor negotiating skills, which are compounded by trade-limiting regulations and the rising economic might of China.

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