India and Brazil, two countries facing the most tariffs from the US, are now preparing to come together. According to media reports, government sources have indicated that India may hold a virtual meeting with the Mercosur trade group next week. The free trade agreement (FTA) will be discussed in this meeting. India has a preferential trade agreement (PTA) with Mercosur since 2004. Mercosur is a regional trade organization in South American countries led by Brazil, with other members Argentina, Uruguay and Paraguay.
According to the report, India is looking for several new export markets to reduce the impact of economic recession in developed countries and recently imposed tariffs by the US. This year Prime Minister Narendra Modi met the presidents of Brazil, Argentina and Paraguay. Apart from this, the Vice President of Brazil is also scheduled to visit India next month. Explain that America has imposed the highest 50 percent tariff on India and Brazil.
These countries are looking for new business partners
According to sources, the Latin American countries are looking for new trading partners and consider India as a big market. India also considers opening markets relatively safe for these countries, as the range and quantity of their products is limited, which reduces the chances of damage to India’s domestic industries. All options are open to increase business, whether to increase the existing PTA from 450 product lines to 4,000, or the movement of skilled professionals and a wide FTA with conditions such as basic terms to prevent dumping or trans-showing from third countries.
2.94 trillion dollar economy
Mercosur countries have more than 67% share in the total economy of South America. The total economy of South American countries is $ 4.38 trillion, with the economy of Mercosur’s member countries $ 2.94 trillion. Sources also said that there is a discussion going on within the Mercosur block to convert PTA into FTA. A comprehensive FTA will provide Indian exporters access to large markets in Mercosur countries. This will also provide India access to new markets in the Caribbean and Pacific regions, where Mercosur countries are often used as a trans-appearance hub.