The author says India’s economic diplomacy is no longer only New Delhi’s: the Union still owns trade deals and WTO work, but liberalisation and investment races have pushed states into the “relational” side—delegations, summits, and investor desks—helped by the MEA States Division created in 2014.

Andhra Pradesh’s APEX-Korea and Tamil Nadu’s Guidance Korea desk (S. Keerthana’s Seoul trip to reassure Hyundai after a change of government) show how states court the same partners; Nara Lokesh talked KOMEA about a ₹30,000-crore Durgarajapatnam shipbuilding cluster. Healthy rivalry can improve services; unsustainable giveaways can not.

Uttar Pradesh’s Yogi visit to Japan pitched a 500-acre Japan Industrial City near YEIDA and a meet that announced ₹3,191 crore and ~10,000 jobs; Gujarat’s Vibrant Gujarat (34 partner countries in 2024, GIFT City, Dholera) is the institutionalized model. The real test, the piece argues, is projects built—not MoUs signed.

For much of India’s post-independence history, economic diplomacy remained firmly within the domain of the Union government. Decisions concerning international trade, investment agreements, multilateral economic institutions and external economic relations were largely driven by New Delhi. This centralised approach reflected the broader structure of India’s political economy, where the Union government exercised considerable influence over policymaking, taxation, public expenditure and industrial development.

India’s economic transformation, however, has gradually altered this arrangement. Economic liberalisation, greater decentralisation and increasing competition among states for investment have created new opportunities for state governments to engage directly with foreign businesses, investors and governments. Today, Indian states are increasingly using economic diplomacy not merely as an extension of foreign outreach but as an instrument of economic development.

Economic diplomacy broadly refers to the use of diplomatic engagement to advance economic interests. It includes both structural dimensions, such as participation in trade negotiations, free trade agreements, World Trade Organization processes and international economic rule-making, and relational dimensions, such as business delegations, investor meetings, trade fairs, ministerial visits and investment promotion. The Union government continues to dominate the structural side of economic........

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