The Comprehensive Economic Partnership Agreement (CEPA) is a broad-based bilateral or regional trade agreement that represents a deeper level of economic integration than a traditional Free Trade Agreement (FTA). The concept originated as a way to enhance economic ties beyond mere tariff reduction, which is the primary focus of an FTA. India has been pursuing CEPAs as a key part of its trade strategy.
A CEPA works by covering multiple facets of economic engagement, including Trade in Goods, Trade in Services, Investment Promotion, and Intellectual Property Rights (IPR). Key mechanisms include the reduction or elimination of tariffs on a wide range of goods, such as the India-UAE CEPA where the UAE eliminated duties on approximately 80–90% of Indian exports. It also liberalises services, with the India-UAE CEPA, signed on February 18, 2022, providing improved market access in 111 sub-sectors from 11 major service sectors. To prevent misuse, the agreement includes strict Rules of Origin, requiring a minimum of 40% value addition for goods to qualify for preferential treatment under the India-UAE pact.
The CEPA framework connects to other advanced trade pacts like the Trade and Economic Partnership Agreement (TEPA) and builds upon the parties' existing WTO commitments. India has CEPAs in force with countries like Japan and the United Arab Emirates. Recently, India has shown a renewed push in trade diplomacy, with the India-UAE CEPA becoming effective on May 1, 2022. Furthermore, India is actively negotiating a CEPA with Canada, with the fourth round of talks concluding on September 18, 2026, and the fifth round scheduled for October 5, 2026. The India-UAE CEPA also included a chapter on digital trade, a first for India in a trade agreement.