Substantial convergence has been achieved in the text of the agreement
The seventh round of negotiations for the India-Peru Free Trade Agreement (FTA) concluded successfully in New Delhi on April 11, 2024, marking significant progress on the text of the proposed pact.

Spanning four days, from April 8 to April 11, 2024, the talks were part of ongoing efforts to strengthen economic relations between the two nations by addressing mutual priorities and concerns in a framework of respect and mutual benefit.

Strategic Importance of the Agreement

The negotiations are particularly significant as India seeks strategic access to Peru's lithium reserves, critical for its rapidly expanding electric vehicle (EV) industry. Peru lies within the 'lithium triangle,' which also includes Bolivia, Argentina, and Chile, known for their substantial lithium deposits. Lithium is a vital component in the battery technology that powers EVs, making it a highly sought-after resource in the global push towards renewable energy technologies.

In this round of negotiations, discussions encompassed across the chapters which included Trade in Goods, Trade in Services, Movement of Natural Persons, Rules of Origin, Sanitary and Phytosanitary Measures, Technical Barriers to Trade, Custom Procedures and Trade Facilitation, Initial Provisions and General Definitions, Legal and Institutional Provisions, Final Provisions, Trade Remedies, General and Security Exceptions, Dispute Settlement and Cooperation, the Ministry of Commerce & Industry said on Friday (April 12, 2024).

"Substantial convergence in the text of the agreement was achieved during the round and detailed discussions were held on the aspirations and sensitivities between both parties," the ministry pointed out. 

Economic Ties and Trade Volumes

According to official data, Peru has emerged as the third-largest trading partner of India in Latin American & Caribbean Region. In the last two decades, the trade between India and Peru has increased from USD 66 million in 2003 to around USD 3.68 billion in 2023. India's exports to Peru include motor vehicles, cotton yarn, and pharmaceuticals. Meanwhile, Peru's exports to India mainly consist of gold, copper ores, and concentrates.

"The trade agreement under negotiations shall play a pivotal role in future collaboration in various sectors, creating avenues for mutual benefit and advancement," the Ministry of Commerce & Industry noted.

Voices from the Negotiation Table

Around 60 delegates together from both sides participated in the negotiations. The Peruvian delegation comprised of representatives from the Ministry of Foreign Trade and Tourism and the Ministry of Foreign Affairs of Peru. The Indian delegates comprised the officials from the Department of Commerce, Directorate General of Foreign Trade, Department of Revenue, Department for Promotion of Industry and Internal Trade and the legal and economic resource persons.

At the start of the talks, Sunil Barthwal, Commerce Secretary of the Department of Commerce, Ministry of Commerce & Industry of India, noted the historical ties between India and Peru, dating back to the 1960s. He highlighted the role of diplomatic exchanges in fostering these negotiations. Rajesh Agrawal, Chief Negotiator & Additional Secretary, Department of Commerce, emphasized the swift pace of the recent negotiations as a testament to both countries' commitment to deepening economic cooperation.

From the Peruvian side, Gerardo Antonio Meza Grillo, Chief Negotiator and Director for Asia, Oceania, and Africa at the Ministry of Foreign Trade and Tourism, remarked on the significance of resuming negotiations after a break and the flexible, pragmatic approach both teams have adopted.

The discussions are set to continue with the next round scheduled for the second week of June 2024 in Lima. These forthcoming talks will likely concentrate on resolving outstanding issues and further refining the trade agreement. The intersessional negotiations, planned over video conferencing, will aim to lay a solid groundwork before the next face-to-face meetings, ensuring that both parties can advance towards finalizing the agreement.

As the negotiations between India and Peru continue to evolve, both nations stand on the brink of forging a deeper economic alliance that promises substantial benefits. The ongoing dialogue reflects a shared vision of enhanced trade and economic collaboration, paving the way for a future where both India and Peru leverage their strengths for mutual prosperity. The successful conclusion of this seventh round of talks marks a significant milestone in their bilateral relations, setting an optimistic tone for the upcoming negotiations in Lima.