More Stories

Informist, Wednesday, Sep 25, 2024

 

By Krity Ambey and Sagar Sen 

 

NEW DELHI - The commerce ministry is reassessing its discussions with Peru for a free trade agreement to secure a more favourable deal, an official said. One round of negotiations was slated for July in Lima, but India opted to postpone it to allow for more thorough consideration of the pros and cons of the agreement.

 

The two sides have held seven rounds of negotiations so far. The last round of talks was held in New Delhi in April. "We are having a deeper look at what else we can seek from them. In terms of various sectors that we would like them to open for us, for example, critical minerals," the official told Informist. "How far would they go to accommodate us? Will they be open to us investing in their country in critical minerals or would they just give us some access to the market?"

 

Peru has a significant geological potential in critical minerals, especially those necessary for green energy transition. Some of the minerals found in Peru include copper, lithium, and others crucial for the production of electric vehicle batteries, renewable energy technologies, and clean energy applications.

 

But Peru's share in India's total imports is less than 1%. India imported goods worth $3.11 bln from Peru in 2023-24 (Apr-Mar), which included copper, iron and steel, gold, and silver. 

 

"We want market access in Peru for automobiles and pharma," the official said. India's exports to Peru were $920.09 mln in the last fiscal year and the basket included transport equipment, pharmaceuticals, and cotton.

 

The strategic pause in discussions aims to optimise benefits from the potential partnership with Peru, the official said. "We are trying to gather the maximum possible mandate for all the tariff lines. So that will take some time. Once this exercise is done, we will start discussions again."

 

There is an eagerness from Peru to resume the discussions soon because there are obvious immediate benefits for them in the deal, the official said. "But we want to weigh all our benefits before proceeding. We have also asked research agencies to take a deep-dive into this."

 

Besides the ministry's in-house research teams, agencies like Delhi-based Research and Information System for Developing Countries, Exim Bank of India, and Federation of Indian Export Organisations are also working with the government on this, the official said. 

"We want to be very clear on what we want before we sit across the table for negotiations," the official said. However, once the negotiations resume, the ministry will conclude the trade deal within six months, the official said. 

 

Peru is the first Latin American country to discuss a free trade agreement with India. Currently, India has preferential trade pacts with Chile and the Mercosur bloc--comprising Argentina, Brazil, Uruguay and Paraguay--in the region. 

 

The commerce ministry is also looking to seal a comprehensive trade deal with Chile, the official said. "We have negotiated the terms of reference and both sides agree." The ministry is awaiting the Cabinet's approval on the terms of the deal, the official said. "Once they get approved by the top, we will launch negotiations with Chile." 

 

India's total trade with Latin America in 2023-24 was $35.73 bln, with exports to the region accounting for $14.50 bln and imports at $21.23 bln.  End

 

US$1 = 83.59 rupees

 

Edited by Vandana Hingorani

 

 

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

 

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.

 

Informist Media Tel +91 (11) 4220-1000

Send comments to feedback@informistmedia.com

 

© Informist Media Pvt. Ltd. 2024. All rights reserved.