India’s Commerce Secretary Rita Teaotia released a statement in which she encourages developing preferential trade agreements with LatAm.
In order to better navigate the current global markets, India has begun looking towards LatAm as a functional business partner. So far, the relationship between the two has been relatively insignificant, but as India looks towards expanding their markets in order to better compete with China, LatAm’s favorable regulatory landscape and sizeable market becomes a valuable alternative.
A report by Indian Commerce Secretary Rita Teaotia which argued for this exact point was released last week in an attempt to spread awareness of the business opportunities concerning stringer trade with LatAm.
“Trade negotiations are on the anvil by several Latin American economies to promote trade with major economies and emerging markets of the world including India to reduce trade barriers and attract investment. This is an appropriate time when Indian small, medium and micro enterprises can rise up and significantly contribute towards enhancing bilateral trade with Latin America” said the report, titled ‘Doing Business in Latin America and the Caribbean’.
It also stated that “many Latin American countries present attractive investment opportunities due to their comparatively favorable regulatory conditions. Through the North American Free Trade Agreement and other foreign investment treaties, many countries in the region — like Mexico and Colombia —have attracted significant investment inflows and established clear regulations governing foreign investments,”.
India’s eagerness to expand trade comes partly as a result of a 33% decline in total trade with LatAm in 2015 compared with the previous year. A disappointment considering that trade between the two parties went from $2 billion USD in the year 2000 to $32.59 billion in 2015. Figures seem to suggest that unless serious efforts are made, trade might have just peaked.
The report also suggested issues with the transportation of goods as a possible cause of limited bilateral trade: “At present, our exports are less than 2 per cent of Latin America’s total imports. Lack of adequate air and maritime connections also hamper trade. We also need better connectivity to promote tourism,”