India accelerates trade agreement negotiations with Peru and Chile

By Admin

07 Nov, 2025

In a significant step towards diversifying export markets and strengthening global trade partnerships, India has accelerated its trade agreement negotiations with Peru and Chile, two of Latin America’s fastest-growing economies. The move comes amid escalating US tariffs on Indian goods, prompting India to explore new markets and reduce dependency on traditional trading partners.

Progress in India-Peru Trade Talks
The ninth round of India-Peru Trade Agreement negotiations, held in Lima, Peru, from 3 to 5 November, marked notable progress across key areas such as trade in goods and services, rules of origin, technical barriers to trade, customs procedures, dispute settlement, and critical minerals. According to the Ministry of Commerce and Industry, both nations displayed strong intent to finalize discussions soon.

Peru’s Minister of Foreign Trade and Tourism Teresa Stella Mera Gómez reaffirmed her country’s commitment to a timely conclusion, emphasizing the complementarity between both economies and expressing optimism about boosting trade and investment flows. Indian Ambassador to Peru Vishvas Vidu Sapkal highlighted India’s growing economic momentum and pointed out new opportunities in sectors like critical minerals, pharmaceuticals, automobiles, textiles, and food processing.

Both sides agreed to hold intersessional meetings to address pending issues before the next round of talks scheduled in New Delhi in January 2026.

India-Chile CEPA Negotiations Gain Momentum
Meanwhile, the third round of India-Chile Comprehensive Economic Partnership Agreement (CEPA) negotiations took place in Santiago, Chile, from 27 to 30 October. The discussions spanned various chapters including trade in goods and services, investment promotion, intellectual property rights, TBT/SPS measures, economic cooperation, and critical minerals.

Both nations reaffirmed their commitment to an early and time-bound conclusion of the CEPA, which aims to enhance market access, strengthen supply-chain resilience, and deepen economic integration between India and Chile.

Strategic Focus on Latin America
India’s renewed engagement with Latin American countries aligns with its strategic push to diversify exports amid global trade shifts. Following the US decision to impose up to 50% duties on several categories of Indian goods effective 27 August, India has been working to expand its trade footprint in emerging markets.

According to reports, the Latin American economies of Peru, Chile, and Mexico together could absorb as much as 20% of India’s current exports to the US, particularly in pharmaceuticals, textiles, engineering goods, and processed foods. Additionally, the region’s abundant reserves of copper, lithium, and other critical minerals make it vital for India’s industrial and energy security.

Trade Performance and Potential
India exported $86.5 billion worth of goods to the US in 2024-25, accounting for 20% of total merchandise exports ($433.56 billion). If Latin American nations can absorb even $17.3 billion of this, it would mark a major step in rebalancing India’s trade geography.

Data from the Commerce Ministry shows steady growth in India’s trade with Latin America. Exports to Peru rose from $0.92 billion in 2023-24 to $1.00 billion in 2024-25, while imports surged from $3.11 billion to $4.98 billion, reflecting a significant trade deficit. With Chile, Indian exports stood at $1.15 billion in 2024-25, while imports increased sharply from $1.51 billion to $2.60 billion, underlining rising demand for Chilean products.

Expert Insights and the Road Ahead
Trade expert Ajay Srivastava, founder of the Global Trade Research Initiative (GTRI), emphasized that India’s trade pact with Peru is part of a broader export diversification strategy. “Latin America offers both market opportunities and access to critical minerals, which are vital for India’s manufacturing and energy sectors. A balanced trade agreement with Peru could help Indian exporters tap new demand while also securing raw material linkages for emerging industries,” he noted.

As India continues to deepen economic ties with Peru and Chile, the momentum in these negotiations reflects a forward-looking trade strategy one that seeks to create resilient supply chains, expand export bases, and secure access to critical resources essential for sustainable industrial growth.