As ASEAN advances its digital economy framework, researchers urge India to strengthen regional digital partnerships to maintain its influence in Southeast Asia’s growing interconnected market.
ASEAN’s push to build a region-wide digital economy is prompting fresh calls for India to deepen its own engagement with Southeast Asia, as researchers argue that the bloc’s new framework could otherwise leave New Delhi outside an increasingly interconnected market. The ASEAN Digital Economy Framework Agreement, or DEFA, was substantially concluded in October 2025 and is intended to create an open, secure and interoperable regional digital economy. ASEAN says the pact could lift the bloc’s digital economy value from $1 trillion to $2 trillion by 2030.
Karthik Nachiappan of the Institute of South Asian Studies at the National University of Singapore and his co-author Atyantika Mookherjee say DEFA’s significance lies less in standard trade liberalisation than in managed interoperability: systems that can work together without forcing countries to adopt identical rules. Their argument is that India should not rely on goods-focused arrangements alone, because the existing ASEAN-India Trade in Goods Agreement is still centred on physical commerce and is already under review.
The researchers say India has already shown it can expand digital links without surrendering control over its own data regime, pointing to arrangements such as UPI-PayNow with Singapore and recent trade deals with Britain and the European Union. They also note India’s growing role in exporting digital public infrastructure, with examples of its influence in Singapore, Indonesia and the Philippines. That, they argue, gives New Delhi a stronger basis for a broader regional digital strategy.
Their proposal is a two-part approach. First, the goods agreement should be modernised to cover paperless trade, interoperable customs procedures and faster payments. Second, India and ASEAN should negotiate a separate digital economy partnership covering payments, digital identity, trusted data flows, privacy, cybersecurity, artificial intelligence and digital skills. The aim would be compatibility rather than uniformity, allowing both sides to retain policy autonomy while still linking into the region’s emerging digital rules.
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