At an Indo-Chilean business co-operation forum organized by Bengal National Chamber of Commerce & Industry (BNCCI) Ambassador of Chile to India Alfonso Silva Navarro said that both countries should plan to upgrade the present Preferential Trade Agreement (PTA) to a FTA. He added that though the goal was to sign a FTA with India soon, but meanwhile both parties should deepen and widen the existing PTA. A meeting to this respect will be held by both countries to discuss what additional products that could be included in the existing list.
Chile and India has signed a PTA in January 2005 aimed at increasing bilateral trade. There are 144 products as per the 2005 agreement, and two-way trade reached more than $2bn in 2007-08 fiscal. At the moment there are huge trade imbalances in favour of Chile as India was able to export just about $250mn worth of products to Chile. Higher taxes in Chile have put Indian products at a disadvantage but a FTA with Chile could bring the taxes to zero on many products.
Lately, Chile has entered into FTAs with several countries including the US, Canada, Australia, China, Japan, South Korea, and many Latin American and the EU countries. It should be recalled, the continuance of free market policies was one of the election campaign promises of the incumbent center-left President Michelle Bachelet.
A FTA between India and Chile is likely to provide India to look at other countries in the region to engage in similar trade ties in the future. Indo-Chilean FTA was likely to multiply bilateral trade in copper, wine, aquaculture products, processed food and forestry products indicated the Chilean Ambassador.
Navarro also said that the Indian exports to Chile would substantially increase when the deal was through. He was of the opinion the talks between both countries were delayed due to the Indian elections, and he hoped to hold talks by August to add more products to the list and reduce the tariffs.