Commerce and Industry Minister Piyush Goyal said that India is working on expanding the Preferential Trade Agreement (PTA) with ‘Mercosur’, the trading group of South American countries. Its objective is to further promote trade and investment between the two regions. Mercosur is a major trading group of Latin American countries, which includes Brazil, Argentina, Uruguay and Paraguay. The PTA between India and Mercosur came into force on June 1, 2009, but currently its scope is limited and it covers only 450 products. Now both sides are considering converting it into a full trade agreement.
Work is going on on PTA
Goyal said at an event of industry body FICCI that India is actively working towards expanding the preferential trade agreement with Mercosur. Goyal said that the Mercosur region holds special importance for us. We are working to expand the scope of the India-MERCOSUR Preferential Trade Agreement to improve market access, increase investment between the two sides, technology partnership and strengthen mutual engagement in areas such as sports, education and culture. Discussing bilateral relations, the Commerce Minister said that trade between India and Brazil is continuously growing, but it is still below its potential. In the year 2025, bilateral trade will reach 15 billion dollars with an increase of 25 percent.
Ongoing cooperation in these sectors
Referring to the depth of bilateral relations, he said that engagement in sectors like defence, energy, agriculture and agrochemicals is continuously increasing. He said that we are also expanding cooperation in sectors like health, medicine, renewable energy, rare earth metals, defense and aviation. Brazilian President Luiz Inacio Lula da Silva was also present in this program. During his visit to India on Saturday, several important agreements were signed between the companies of the two countries for cooperation in the pharmaceutical and infrastructure sectors.
India will become the world’s third largest economy
Goyal said that India is on the way to become the world’s third largest economy, leaving Germany behind in the next two years. This will be driven by reforms in taxation, logistics, manufacturing and digital infrastructure as well as measures to reduce the burden of compliance and improve ease of doing business. He said that when we think of Brazil, we think of its rich natural resources, minerals like niobium, lithium and iron ore, which are vital to shaping the future of technology and the global energy transition.
Capacity in India and Brazil
The minister further said that all this together makes Brazil our strategic partner in the global supply chain. Together, we have the potential to reshape global supply and value chains with resource innovation and forward thinking. India and Brazil also agreed to target annual bilateral trade of $20 billion within five years and signed a cooperation agreement on essential minerals following talks between Prime Minister Narendra Modi and Brazilian President Luiz Inacio Lula da Silva.
$30 billion bilateral trade
Addressing the forum, Lula said that the potential to increase trade between the two economies is still considerable. He said that this is a lot of growth, but if we keep in mind the size of Brazil and India, it is still not much. He said that both the countries want a stronger relationship beyond the traditional markets like Europe, US, Japan and China. He said mutual trade could eventually reach $30 billion. Silva said that we decided to change it because the potential for political, economic, cultural, scientific, technological interaction between Brazil and India is huge.