New Delhi: India and Brazil Thursday issued a joint declaration to “deepen” the trade agreement between New Delhi and the Mercosur grouping, with an aim to complete negotiations within a year after launching.
“I discussed expanding the Preferential Trade Agreement with Brazil so that in future we [India] could penetrate the South American market further,” Piyush Goyal, India’s Minister for Commerce and Industry said Thursday while speaking to the media after the India-Brazil Business Dialogue.
Goyal met with Brazilian Vice President Geraldo Alckmin, who is also the Minister of Development, Industry, Trade and Services. Alckmin is in India for a three-day visit from 15 October till 17 October, as New Delhi and Brasília look to expand their strategic relationship.
“As the fastest growing large economy in the world and a strong macroeconomic story is helping to shape our [India’s] global partnerships. Young talent and skill, huge consumer demand and 140 crore Indians working with passion to make Viksit Bharat 2047 a reality, is attracting investment,” added Goyal.
The Indian Minister of Commerce and Industry further highlighted the bevy of Brazilian ministers visiting India along with the Vice President, the ministers of defence and health among them—all indicate Brasília’s interest in India’s growth story. Goyal, however, maintained that this interest and friendship is “not determined by other factors”. Brazil and India are two of the largest economies hit with 50 percent tariffs by US President Donald J. Trump, which came into force in August.
Trump has had serious issues with Brazil’s President Lula, claiming that the former Brazilian President Jair Bolsonaro, who is facing serious legal charges, is being unfairly targeted. Bolsonaro and Trump had a good relationship during the latter’s first tenure in the White House.
Lula has pushed to deepen and diversify Brazil’s relationship with other countries as ties between Washington D.C. and Brasília have cratered. Trump has imposed similar tariffs on India, citing New Delhi’s continued purchase of Russian oil.
Both India and Brazil are also members of BRICS+, the grouping that has come under attack by Trump for being anti-American. India takes over as the chair of BRICS+ in 2026 from Brazil, which currently leads the 10-member organisation.
“They [Goyal and Alckmin] agreed that: the expansion of the [Preferential Trade] Agreement should be substantial, aiming for a significant share of bilateral trade to benefit from tariff preferences; the expansion of the Agreement should cover both tariff and non-tariff issues related to trade and economic partnership,” the joint declaration Thursday said.
It added: “the next step in this initiative should be the establishment of a technical dialogue between the parties, including the holding of a meeting of the Joint Administration Committee created under Article 23 of the PTA at the earliest mutually convenient date, with a view to defining the scope of the expansion; parties should endeavour to conclude the negotiations within one year from the launch of negotiations.”
Mercosur is a South American trading bloc established in 1991 and consists of five full members, namely Argentina, Brazil, Bolivia, Paraguay and Uruguay. India and MERCOSUR signed a PTA in January 2004, focussing on reciprocal tariff mechanisms for limited merchandise exports, with the aim of negotiating a larger free trade agreement at a later date.
The PTA came into force in June 2009. However, any further expansion of the agreement has yet to occur. India has been seeking to negotiate and sign a number of free trade agreements in recent months.
In March 2024, India signed a free trade agreement with the European Free Trade Association (EFTA) countries consisting of Norway, Iceland, Switzerland and Liechtenstein. Earlier this year India concluded negotiations with the UK for a FTA. Currently India is negotiating with the US for a bilateral trade deal, and is expected to complete negotiations with the European Union (EU) for a FTA by early next year. Other countries and organisations India is currently negotiating trade agreements with include Chile, Oman, the Eurasian Economic Union (EAEU) and Australia.
(Edited by Amrtansh Arora)
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