INDIA’S DUTY FREE TARIFF PREFERENCE SCHEME
Why in News
- According to the latest WTO Report (October 2025) titled “Market Access for Products and Services of Export Interest to Least Developed Countries,” India has surpassed China and the European Union (EU) in providing the widest duty-free market access to Least Developed Countries (LDCs).
- The WTO has credited India’s DFTP Scheme (2008) for boosting exports from some of the world’s poorest economies—particularly in Asia and Africa—and strengthening South-South trade cooperation.
ABOUT DUTY FREE TARIFF PREFERENCE SCHEME
GLOBAL & TRADE CONTEXT
- India is now the 5th-largest destination for LDC exports (6.8% share, $21.5 billion in 2024). Ahead are: China (25%), EU (17%), UAE (12%), and USA (9%).
- LDC exports to India mainly include minerals, agricultural commodities, and textiles.
- Global LDC exports reached $277 billion (2024), growing at 7% annually, with India’s DFTP playing a key enabling role.
KEY FEATURES
- Duty-Free Market Access:
- 1% of tariff lines covered (approx. 98% of trade value).
- Tariff concessions across sectors like agriculture, textiles, leather, and handicrafts.
- Eligibility:
- Available to all UN-recognized LDCs (48 nations globally).
- India currently extends benefits to 35+ countries.
- Non-Discriminatory Access:
- Offered without political quid pro quo — purely developmental and trade-facilitating.
- Trade Facilitation + Development Focus:
- Supports diversification of LDC exports and economic growth.
- Aligns with India’s “Neighbourhood First” and “Act East”
WTO FINDINGS & RECOGNITION
COMPARISON WITH GLOBAL ECONOMIES
STRATEGIC & ECONOMIC IMPLICATIONS
- Enhances regional influence and credibility in multilateral trade forums.
- Serves as a counterbalance to China’s model of engagement with LDCs.
- Strengthens India’s voice in WTO reform and Global South cooperation.
- Encourages inclusive trade, fostering trust and stability in South Asia and Africa.
CHALLENGES & WAY FORWARD
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