India and the Eurasian Economic Union (EAEU), a bloc of five nations (Armenia, Belarus, Kazakhstan, Kyrgyzstan, and Russia), have signed the terms of reference to begin formal negotiations for a proposed free trade agreement (FTA). This development is seen as a crucial step for India to diversify its export markets in light of the high tariffs imposed by the U.S.. The agreement is expected to unlock untapped trade potential, increase investments, and establish a stronger economic partnership. The two-way trade between the two entities was $69 billion in 2024, a 7% increase over the previous year.
The proposed FTA is expected to expand market access for Indian exporters, support diversification into new sectors and geographies, and enhance competitiveness. Russia is India’s top trading partner within the EAEU bloc, with bilateral trade reaching $68.72 billion in 2024-25. The terms of reference were signed in Moscow by officials from both sides, reaffirming their commitment to a long-term institutional framework for trade cooperation.