India–Turkey Trade Ties Enter Strategic Recalibration Amid Geopolitical Shifts

 From automobiles and information technology to metro rail and tunnel infrastructure, Turkish companies have maintained a significant presence in India across at least five major states—Gujarat, Maharashtra, Uttar Pradesh, Jammu & Kashmir, and Delhi. With several bilateral Memoranda of Understanding (MoUs) signed across sectors, the total trade volume between India and Turkey stood at US$ 10.4 billion in FY24.

According to a February 2025 review by the India Brand Equity Foundation (IBEF)—a trust under the Department of Commerce, Ministry of Commerce and Industry—Turkey ranks 45th in terms of Foreign Direct Investment (FDI) equity inflows into India, with cumulative FDI reaching US$ 240.18 million between April 2000 and September 2024.

Turkish investments span strategic domains such as construction, manufacturing, aviation, and metro infrastructure, as well as soft sectors including education and media. Over the past decade, bilateral cooperation has extended from the trade of poppy seeds to joint initiatives in telecommunications, cultural exchange, education, media, and diplomacy.

However, in the aftermath of Operation Sindoor, a quiet yet deliberate policy reassessment is underway. The Government of India has begun a comprehensive review of all Turkish business engagements within the country, including those concluded in previous years. A senior government official, speaking on condition of anonymity, confirmed that “all projects involving Turkish firms are under scrutiny,” with authorities actively compiling detailed data and documentation across both public and private sector agreements.

Notably, a Turkish firm had been contracted for the electromechanical component of the Atal Tunnel project in Jammu & Kashmir in 2020, and in 2024, Rail Vikas Nigam Limited (RVNL) signed an MoU with another Turkish company for metro rail development. While Turkey has served as a longstanding partner in India’s infrastructure and technology sectors, recent diplomatic recalibrations signal a shift in India’s engagement strategy.

Turkey’s repeated references to Kashmir in international fora and its growing proximity to Pakistan have drawn the attention of policymakers in New Delhi. Although the Modi government has traditionally adopted a measured approach to retaliatory diplomacy, recent developments suggest a “silent unwind” of economic ties with Ankara is underway. Post Operation Sindoor, this strategic disengagement appears to have gained further momentum.

A senior trade analyst affiliated with the Ministry of Commerce noted, “While all agreements are under review, certain MoUs and long-term contracts may remain unaffected in the short term. However, Turkey’s persistent interference in the Kashmir issue is likely to cast a shadow over future investment flows and trade prospects.”

Among the most visible Turkish entities operating in India are construction firms engaged in metro projects in Lucknow, Pune, and Mumbai. A Turkish company has also set up a manufacturing unit in Gujarat through a joint venture with an Indian partner, while a major Turkish aviation player maintains a footprint at Indian airports—marking significant involvement in critical infrastructure and public services.

The 2017 visit of President Recep Tayyip Erdoğan to India had catalyzed a series of cooperation agreements, including media partnerships and diplomatic training exchanges. However, eight years later, those early ambitions for synergy appear to be yielding to a more pragmatic and guarded posture—economic distancing shaped by geopolitical divergence.

While the government has not made any official announcements regarding the termination of Turkish contracts, the direction of policy is increasingly clear. In the current global landscape, India is demonstrating a more assertive stance, signaling that economic partnerships misaligned with its strategic imperatives—no matter how commercially viable—may face a phased, low-profile withdrawal.