The government has decided to start talks for a Free Trade Agreement (FTA) with Peru in an effort to boost bilateral relations and expand India’s trade and investment ties, especially in the agri business as well as commodities like gold, with the Latin American region.
“The ministry of commerce of India has informed the government of Peru that it has set up a working group that will engage in joint studies for the negotiation of a trade agreement between
the two countries,” Javier Paulinich, ambassador of Peru to India, told FE. This is the first time India has offered such a study for negotiations towards an FTA to a Latin American country.
According to the envoy, the joint working group work is intended to identify the strategic and economic benefits for both nations, review the institutional framework, infrastructure and bilateral trade mechanisms.
The group also aims to determine the negotiation framework to facilitate trade in goods, services and investments. According to embassy officials in New Delhi, India is an important market with great potential for development.
Edgar Vasquez, Peru’s vice-minister of foreign trade, had told FE during an earlier visit: “Peru could be used by Indian investors to set up base in Latin America and also Peru can use India as its base in south countries (South Asian countries).”
Indian exports to Peru are expected to cross the $1 billion mark, yet India is at a disadvantage vis-a-vis exports from Peru’s FTA partners. Paulinich said Peru began exporting gold to India two years ago and that there are 4-5 gold mines which are keen to offer joint entrepreneurship opportunities to India.
The Peruvian government has invited Indian businessmen to invest in the country for construction of roads, highways, ports, airports, telecommunications and energy and to take advantage of its tourism spots to boost bilateral tourism ties. The country is also keen on tapping India for space technology.
Talks related to setting up of the group had been going on for a while between the two countries, and the commerce ministry decided to
set it up in the last week of January only.