According to the commerce ministry officials, India is looking forward to sign an FTA with Peru as the first step of engagement. It is also eyeing similar trade agreements with some other Latin American countries. "Latin America is a key bloc for us. So far our trade has been restricted to Brazil and Argentina but there are other key markets which we are exploring," an official said.
The government is looking forward to include newer Latin American countries in the focus market scheme (FMS) and announce tax breaks for Indian exporters. India is also expected to reduce import duties on a set of imports from Latin America. According to a report published by Inter-American Development Bank, agricultural exports from Latin America attract an import duty of 65% in India.
The initiative has been taken up by Jyotiraditya Scindia, minister of state for commerce. In an earlier interview with FE, Scindia had said that Latin America housed a set of developing economies which held a lot of potential of trade with India. "In our foreign trade policy (FTP) announcement, we have steadily shifted the focus to developing countries because it is from these areas that the growth will come," Scindia said.
A senior trade expert said that India's increased engagement with Latin America was needed because China had already ramped up its trade with that part of the world. "Not only does Latin America throw open opportunities for trade, the bloc of these countries are also important from a strategic standpoint. China's has made that clear enough," he added.
Earlier this month Scindia led a delegation to Peru scouting opportunities for enhanced trade between the two countries.