Why India is opposing a China-led investment deal at WTO
22 Mar 2026

India is facing the threat of political isolation as support for the China-backed Investment Facilitation for Development (IFD) Agreement at the World Trade Organization (WTO) continues to grow.

The 14th Ministerial Conference, a major global meeting, will be held in Cameroon from March 26.

A key agenda item will be a proposal to include the IFD Agreement in the Marrakesh Agreement that established WTO in 1995.

What is the IFD agreement?
Agreement

The IFD Agreement, first proposed in 2017, aims to improve the investment climate and promote international cooperation for foreign direct investment (FDI) among WTO members.

It particularly focuses on developing and least-developed countries (LDCs) and sustainable development.

Since its introduction, support for this agreement has grown from 70 to 128 countries (out of 166 WTO members) last year.

India remains principal holdout on IFD
Opposition explained

Despite the growing support, India remains the principal holdout on the IFD Agreement. This has even drawn criticism from smaller nations grappling with investment shortages.

India's opposition stems from concerns that adopting the IFD through a plurilateral route raises broader questions about the WTO's future, which is traditionally based on multilateralism and consensus.

India's fears regarding plurilateral deals
Concerns raised

India fears that plurilateral deals like IFD could undermine the balance of interests in WTO negotiations between developed and developing countries.

It warns such agreements could sideline issues like farm subsidies, thus creating a two-tier WTO dominated by major economies.

Ajay Srivastava, former trade officer and founder of think tank Global Trade Research Initiative (GTRI), said India's opposition to IFD at the 2024 ministerial could weaken, with African Union members likely to pressure South Africa to change its stance.

Strategic considerations behind India's opposition to IFD
Strategic factors

The New Delhi-based think tank Research and Information System for Developing Countries (RIS) has flagged strategic considerations behind India's opposition to IFD.

The World Trade and Development report said that a key feature of the IFD is its overlap with China's connectivity and infrastructure projects.

Of the 128 IFD supporters, 98 are also part of China's Belt and Road Initiative (BRI).

India's position on IFD could be tactical
Subsidy issue

India's position on the IFD could also be tactical, in light of its demand for a permanent solution to the issue of public stockholding of food grains.

Under WTO norms, agricultural subsidies shouldn't exceed 10% of agricultural production value.

However, India has breached this limit several times with rice subsidies and invoked the 'peace clause' agreed upon at the 2013 Bali ministerial to avoid legal action.