Mercosur and India expected to expand preferential trade agreementStaff Writer | August 16, 2016
India has begun the process of expanding its preferential trade agreement with the Mercosur trade bloc, opening its market more to South America and negotiations are expected to start in a month or two.
Trade talks Opening Indian market more to South America
India, on the other hand, wants to export processed foods and engineering goods to the Mercosur, which comprise Argentina, Brazil, Paraguay and Uruguay. Venezuela, a Mercosur member, is not a party to the agreement.
The two sides have been discussing the expansion for a couple of years. The issue also came up at the WTO in March when several countries raised questions about the limited coverage of the pact and if more members could be included in the deal.
“The wish lists have been exchanged and industry consultations are on... negotiations may start by October,” said an official linked to the talks.
Under the existing agreement, India has reduced import duties on 450 products coming from Mercosur including meat and meat products, organic & inorganic chemicals, dyes, raw hides and skins, leather articles, wool, cotton yarn, glass, articles of iron and steel, machinery items, electrical machinery and equipment.
The Mercosur grouping gives tariff concessions on 452 products for India which include food preparations, organic chemicals, pharmaceuticals, essential oils, plastics articles, rubber and rubber products, tools and implements, machinery items, electrical machinery and equipment. The tariff cuts, under the pact signed in 2009, range from 10% to 100%. ■