India-Chile Current Affairs
India and Chile have inked an agreement to expand the scope of their existing Preferential Trade Agreement (PTA) by covering more goods for tariff concessions.
A PTA between India and Chile was earlier signed in March 2006 and had come into force with effect from August, 2007.
Under the expanded PTA
- Chile has offered concessions to India on 1,798 tariff lines with Margin of Preference (MoP) or rate of concessions, ranging from 30-100%.
- Likewise, India has offered concessions to Chile on 1,031 tariff lines, with MoP ranging from 10-100%.
Expansion of India-Chile PTA will enhance the trade and economic relations between the two countries. It will be an important landmark in India-Chile relations and consolidate the traditional fraternal relations that have existed between India and LAC countries.
- Among the Latin American Countries (LAC), Chile was the third largest trading partner of India during 2015-16.
- During 2015-16, India‘s bilateral trade with Chile stood at US$ 2.64 billion with exports at US$ 0.68 billion and imports at US$ 1.96 billion respectively.
- India has friendly relations with Chile and India’s exports to Chile are diverse. Chile also has been cooperating with India at the International fora.
The Union Cabinet has given its approval for expansion of India-Chile Preferential Trade Agreement (PTA) between both countries.
Decision in this regard was taken by the Union Cabinet meeting chaired by Prime Minister Narendra Modi in New Delhi.
- Under the expanded PTA, India has offered concessions to Chile on 1031 tariff lines at 8-digit level with Margin of Preference (MoP) ranging from 10 to 100%.
- While, Chile has offered concessions to India on 1798 tariff lines with MoP ranging from 30 to 100%.
- Under it, 86% of India’s exports to Chile will get covered with concessions, which is likely to result in doubling of its exports in the near future.
- Expanded PTA would also immensely benefit India, keeping in view the wide variety of tariff lines offered by Chile as India’s export basket has diversified with Chile.
- The Preferential Trade Agreement (PTA) between India and Chile was signed in March 2006 and it came into force with effect from August 2007.
- Since then the trade dynamics have changed between both countries after the PTA came into force.
- Bilateral trade between both countries has registered a growth of 58.49% from 2006-07 to 2014-15.
- During 2014-15, the bilateral trade stood at US 3.65 billion dollars with exports at US 0.57 billion dollars and imports at US 3.08 billion dollars respectively.
The expansion PTA would be an important landmark in India-Chile relations as both countries have friendly relations. It would help to enhance the trade and economic relations between the two countries and also help India to consolidate the traditional fraternal relations that have existed with Latin American Countries (LAC).