Indian government clears trade pact with Mercosur

Friday, 06 June 2003, 19:30 IST
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NEW DELHI: The Indian government Thursday cleared an agreement with the South American trade grouping of Mercosur aimed at enhancing economic ties and clearing the way for a free trade treaty. The framework agreement between Mercosur -- which comprises Argentina, Brazil, Uruguay and Paraguay -- and India will promote the expansion of trade and create conditions for a free trade area between the two sides, said a government spokesman. The cabinet, which met here Thursday under the chairmanship of Prime Minister Atal Bihari Vajpayee, cleared the framework agreement. India's total trade with Mercosur during 2001-02 was worth $1.39 billion, with Indian exports amounting to $626.49 million. "The region still has a huge potential for Indian exporters as India's share is just .83 percent of the global imports of Mercosur during 2001," the spokesman said. The framework agreement will initially pave the way for India to enter into a preferential trade agreement. This will be followed by the negotiation of a free trade agreement, he said. India's major exports to Mercosur are drugs, pharmaceuticals, fine chemicals, cotton fabric, readymade garments and coal tars. It imports edible vegetable oils, metal scrap and non-electrical machinery from the South American grouping.
Source: IANS
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