Whalesbook
India is stepping up trade deals and resource security efforts as part of a wider economic strategy. The country aims to use international agreements to strengthen its manufacturing base and meet ambitious export targets. The upcoming Oman FTA showcases proactive trade diplomacy, while talks with Chile focus on securing essential raw materials for future industrial growth and technology.
Securing Key Minerals Fuels Self-Reliance
The India-Oman Comprehensive Economic Partnership Agreement (CEPA) will take effect on June 1, 2026, significantly boosting bilateral trade, which reached about $10.61 billion in FY2024-25. The pact offers India 100% duty-free access for 98.08% of its export items, creating opportunities in engineering goods, pharmaceuticals, agriculture, marine products, textiles, and chemicals. More strategically, advanced negotiations are underway for a Free Trade Agreement (FTA) with Chile. Chile holds large reserves of critical minerals like lithium, copper, cobalt, and rhenium, which are vital for India's growing electric vehicle (EV), electronics, and clean energy sectors. Securing these minerals is key to India's 'Atmanirbhar Bharat' (Self-Reliant India) initiative, especially given global supply chain risks and geopolitical tensions, including those stemming from the conflict in Iran. India's National Critical Minerals Mission, launched in 2025 with a ₹16,300 crore budget, aims to reduce import dependency for minerals like lithium needed for batteries. India is also working with Russia, Brazil, Argentina, and Australia to source critical minerals, aiming to diversify supply chains and lessen reliance on countries like China.
Export Ambitions and Global Context
These trade moves support India's goal of reaching $2 trillion in total exports by 2030-31, with $1 trillion each in goods and services. This target is backed by a framework for monitoring exports, setting sectoral goals, coordinating ministries, and using digital tracking. India's drive for self-reliance covers not just minerals but also technology, defense manufacturing, and energy, aiming to build resilience against external shocks. While the Oman CEPA provides immediate market access, the Chile FTA is a long-term play to secure crucial resources for India's industrial and energy transition plans. Worldwide, critical minerals are seen more as strategic assets than just industrial inputs, with their supply chains vulnerable to geopolitical influence. Chile's large lithium reserves (an estimated 9.3 million metric tons) make it a key partner, though Australia is the world's top producer. India's plan to diversify its mineral sources mirrors global efforts to secure supply chains for materials essential to the energy transition and technological advancements.
Challenges Ahead
However, significant challenges remain. Negotiations for the India-Chile FTA, though advanced, could be delayed by issues over pricing, environmental rules, and Chile's domestic content requirements. India also still heavily relies on imports for many critical minerals, and lacks sufficient processing and refining infrastructure, creating bottlenecks. Achieving the $2 trillion export target requires steady annual growth of about 15% and faces headwinds from global economic slowdowns, trade protectionism, and competition. Minister Goyal's push for self-reliance must balance national goals with integration into global value chains, a difficult task. Geopolitical instability, such as the conflict in Iran, could disrupt trade routes and commodity prices, affecting import costs and potentially widening India's trade deficit, which is already substantial with GCC nations due to energy imports. The success of the 'Atmanirbhar Bharat' vision depends on effectively implementing domestic policies and building processing capabilities, areas where India trails global leaders like China.
Future Outlook
India's trade strategy is clearly focused on securing strategic resources and expanding market access, demonstrated by the Oman FTA and the ongoing mineral talks with Chile. The government's systematic approach to its $2 trillion export goal, alongside initiatives like the National Critical Minerals Mission, shows a strong drive for a more resilient and self-sufficient economy. Future efforts are expected to focus on diversifying trade partners, increasing domestic manufacturing, and strengthening India's role in global supply chains, particularly for technology and sustainable energy. The success of these plans will hinge on overcoming execution hurdles, managing geopolitical risks, and maintaining steady growth in a changing global economy.