From Sovereign Isolation to Negotiated Autonomy: An Empirical Analysis of India's Trade Policy Space

This paper analyses the evolution of India’s trade policy space from the 1950s “Self-Reliance” era to the 2026 landscape of “Negotiated Autonomy.” Utilizing a mixed-methods approach, it examines how the 1991 LPG reforms transitioned India from autarkic isolation to a rule-based multilateral framework. Findings highlight the strategic use of a “Policy Cushion”—the gap between WTO Bound and Applied MFN rates—to facilitate industrial intervention through PLI schemes. Despite achieving a trade-to-GDP ratio of 45%, challenges persist regarding a $100 billion trade deficit with China. The study concludes that India’s contemporary trade strategy represents a sophisticated “dual-track” model of calibrated global integration.