The Indian government has released the draft Digital Trade Facilitation Bill, 2026, seeking public feedback on the proposed legislation aimed at providing legal recognition to electronic trade documents. This bill aims to streamline international trade by ensuring that digital documents are recognized globally and accepted across borders.
The Digital Trade Facilitation Bill, 2026, seeks to modernize existing trade practices by providing a legal framework for the use and cross-border acceptance of digital identities and trust services. The bill addresses the long-standing issue of the legal equivalence of electronic and paper trade documents. Currently, traditional English law dictates that physical possession of paper trade documents determines who can legally exercise the rights and obligations granted by the document. This creates a conflict with the demands for speed and efficiency in international trade, hindering the adoption of electronic trade documents.
The recognition of electronic trade documents as equivalent to paper documents has the potential to generate significant cost savings and efficiency gains. The International Chamber of Commerce (ICC) has estimated that digitalizing trade documents could generate £25 billion in new economic growth and free up £224 billion in efficiency savings. By removing the need for physical paper, businesses can save time and money while gaining access to accurate, real-time data on trade flows. This enhanced data visibility is vital for tackling illicit trade, improving security and compliance, and promoting a more sustainable global economy.
The bill does not mandate the use of digital documents. Instead, it will provide businesses with the option to use paperless documents if they wish. This flexibility acknowledges that paper and electronic documents are likely to coexist for some time as market participants gradually adopt digital processes.
Many initiatives are ongoing to promote paperless trade. The Asia-Pacific region's "Framework Agreement on Facilitation of Cross-border Paperless Trade in Asia and the Pacific (CPTA)" which came into force in February 2021, focuses on cross-border mutual recognition of trade-related data and documents in electronic format.
The Digital Trade Facilitation Bill, 2026, is a crucial step toward modernizing India's trade infrastructure and aligning it with global best practices. By providing a clear legal framework for electronic trade documents, the bill has the potential to reduce transaction costs, improve efficiency, and boost India's competitiveness in the global marketplace.