India and Chile to expand their bilateral trade
The Dollar Business Bureau
The Union Cabinet, on Wednesday, has approved the expansion of preferential trade agreement (PTA) between India and Chile. This pack is signed with the aim to expand trade relations with Chile—experts are of the opinion that this is a radical step towards doubling India’s export to Latin American countries in the future.
In an official statement released by the government of India, it states “India's export items to Chile is diversified; and in favour of India, Chile has offered a huge range of tariff lines that would benefit India in many ways.” Under the expanded PTA, India agreed on concession on 1031 tariff lines while Chile offered concessions on 1798 tariff lines—Margin of Preference (MoP) ranging between 10-100% and 30-100%, from India and Chile.
The first PTA between India and Chile was signed in March 2006, which became effective in August 2007. In FY2007, Chile was ranked 51st export destination for India—the bilateral trade harvested in FY2007 was $2.3 billion. The bilateral trade between the two nations stood at 58.49% between FY2007 and FY2015. In FY2015 alone, the trade value between the two was $3.65 billion; exports at $0.57 billion and imports at $3.08 billion.
But under the MoP expansion move on PTA, India’s exports to Chile will get covered around 86% with concessions—a huge leap from the existing PTA. India and Chile share a friendly relation – Chile has been cooperating with India at the International fora too. Thus, the expansion of India-Chile PTA will enhance the trade and economic relations between the two. The statement further stated, “This is a landmark in India-Chile trade relations, a door that has opened up for India to expand trade in Latin American Countries.”