India-Mercosur trade: India and Brazil agree to expand trade pact; aim for deeper economic partnership

India and Brazil on Thursday agreed to broaden the scope of the existing preferential trade agreement (PTA) between New Delhi and the Mercosur bloc, aiming to strengthen economic ties and boost bilateral trade. Mercosur, a South American trading bloc, comprises Brazil, Argentina, Uruguay, and Paraguay.The discussions took place during a meeting between visiting Brazilian Vice President Geraldo Alckmin and India’s Commerce and Industry Minister Piyush Goyal in New Delhi, PTI reported. Both sides agreed to set up a technical dialogue, including convening the Joint Administration Committee under the PTA, to define the scope of the expansion at the earliest mutually convenient date. “Parties should endeavour to conclude the negotiations within one year from the launch of negotiations,” the commerce ministry said.The India-Mercosur PTA, which came into effect on June 1, 2009, currently covers only 450 tariff lines. Both sides are now looking at transforming it into a full-fledged agreement covering a substantial share of bilateral trade, including both tariff and non-tariff measures. The ministry statement noted that active participation of the private sector and other stakeholders will be encouraged to support the negotiation process.Brazil, India’s largest trading partner in Latin America, reported bilateral merchandise trade of USD 12.19 billion in 2024-25, with a target to reach USD 20 billion over the next five years. Goyal said expanding the PTA will allow India to penetrate the South American market more effectively in the future.Alckmin expressed confidence that the USD 20 billion target will be achieved and highlighted the role of the Double Taxation Avoidance Agreement in creating a predictable business environment. “We are ready to launch a digital partnership… towards artificial intelligence… high performance computing,” he added.