Informist, Friday, Jun 21, 2024

--Govt source: Aim to conclude free trade pact talks with Peru by Mar

By Krity Ambey

NEW DELHI – The commerce ministry aims to conclude negotiations for a free trade agreement with Peru by the end of the current financial year ending March 2025, a government official said. Peru is the first Latin American country to discuss a comprehensive agreement with India. Currently, India has preferential trade agreements with Chile and the Mercosur bloc — comprising Argentina, Brazil, Uruguay and Paraguay — in the region.

India and Peru are set to hold the next round of discussions in July in the latter's capital city, Lima. "So far, the discussions have been very smooth," the official told Informist.

"On the basis of the stance they (Peru) have taken on the issues, we think we will be able to resolve everything soon. "

"Last time we had extensive discussion on rules of origin, goods trade, customs procedures and trade facilitation. Some of the chapters are almost concluded," the official added. "This time we also hope to discuss services trade, movement of people, and investment." The two sides had held a round of negotiations in April in New Delhi.

India had initiated negotiations for a free trade pact in 2017, but the talks were disrupted after the last round of discussion in 2019, due to the COVID-19 pandemic. The government had then resumed discussions with Peru about the pact in October.

"We have also been holding regular stakeholder consultations to better understand the areas of cooperation with Peru," the official said. India's total trade with Peru was $4.03 bln 2023-24 (Apr-Mar), with exports amounting to $920.09 mln and imports worth $3.11 bln. The major components in India's export basket to Peru are transport equipment, pharmaceuticals, and cotton. On the import side, the top commodities sourced from Peru are gold, silver, copper ore, and iron and steel.

India hopes to expand its footprint in Latin America through the free trade agreement with Peru, the official said. "The learnings from the Peru agreement will also be helpful in negotiating a deal with other Latin American blocs and countries." New Delhi also aims to start discussions for a free trade deal with Chile in August, Informist had reported this week.

India's merchandise exports shrank 3% in 2023-24 to $437.06 bln due to the slump in overseas demand from traditional markets like the US and the European Union on account of an economic slowdown. The commerce ministry is now exploring new export destinations in Latin America to protect Indian exports against such circumstances in future, the official said.

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

US$1 = 83.53 rupees

Edited by Tanima Banerjee

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