Malaysia, India move to rebalance trade, review FTA

NEW DELHI: Malaysia and India are planning to review their trade relationship over the next three to six months, aiming to create a more balanced exchange of goods and increase two-way trade, said Investment, Trade and Industry Minister Datuk Seri Johari Abdul Ghani. During his meeting with India's trade minister, Johari discussed Malaysia's trade surplus with India as a key topic.

India emphasized the importance of a more balanced trade relationship, especially since Malaysia currently records a significant surplus with the country. Johari highlighted that Malaysia's trade surplus with India in 2025 was RM25.37 billion, with total bilateral trade reaching RM79.33 billion, a 5.0 percent decline from RM83.5 billion (US$18.25 billion) in 2024.

To expand trade, Johari suggested leveraging India's vast consumer market of around 1.4 to 1.5 billion people, in addition to increasing imports, investments, and commercial partnerships. The Indian trade minister expressed interest in reviewing the Free Trade Agreement (FTA) to enable both countries to leverage each other's markets and boost trade.

Johari emphasized Malaysia's strategy to diversify trading partners, particularly as global trade patterns evolve. He stressed the importance of trading with large markets to provide more growth opportunities for Malaysian businesses and help spread trade across a wider range of partners. During his three-day visit to India, Johari also highlighted potential areas for closer cooperation, including the automotive industry and palm oil, as well as broader efforts to strengthen bilateral trade and investment.

Malaysia aims to build a more balanced trading relationship that benefits businesses in both nations, rather than creating a one-sided relationship.