Monday, 14 October 2013

India And South America Relations

South America is a Continent & ranks fourth in terms of area. It comprises of thirteen sovereign states : Argentina, Bolivia, Brazil, Chile, Colombia, Ecuador, Guyana, Paraguay, Peru, Suriname , Trinidad and Tobago, Uruguay, Venezuela and two non-sovereign areas : French Guiana (an overseas region of France) and Falkland Islands Territory( a British Overseas Territory).

India and South America                                                           

Political relations:

Relations among India and countries of South America have been friendly and cordial (bilaterally). Common reasons behind this lie in the historical fact that both are ex-colonies & both are in the development phase & require  each other’s contribution for their own development.India And South America Relations Also on many international issues both sides have common view.

Implication of Regional Integration for India’s Trade 

Due to presence of South American Common Market (MERCOSUR) and free trade agreements between South American countries, Indian exporters are at a disadvantage. Our exporters don’t get competitive edge as compared to same products which the South American countries exchange among themselves which go duty free.

  • Government of India is negotiating with Colombia and Venezuela for Preferential Trading Arrangements (PTA).
  • Apart from this, the institutional cooperation agreements with Mercosur and Andean Community are on the anvil.

Bilateral Trade:

Over the years following three tendencies have been seen in bilateral trade between India and South America:
a. Indian imports are greater than exports from South America.
b. Main imports from South America consists of vegetable oil (mainly), iron and copper minerals, wood equipments & leather products.
c. Main exports to South America consists of motorcycles and threewheelers, iron and steel products, chemicals, machinery and instruments, etc.

ITEC programme:

The Indian Technical and Economic Cooperation (ITEC) Programme was started by Indian Government as a bilateral programme of assistance. Various scholarships are given to students from South America under ITEC to incorporate their youth with latest technical knowledge & help in nation building.

Regional Action Plan:

Argentina has started a special programme named “Regional Action Plan” to promote India’s commercial and economic interests in Argentina especially with special focus on its Provinces to :
a) identify areas of imports and exports
b) bring investment in mining, energy and infrastructure in provinces with assured returns
c) identify sectors for manufacturing or joint ventures for export to Argentina and Latin American countries
d) export technical collaboration and
e) organize visits of the Governors of States with commercial delegations to India.

Potential Areas for development:

The countries in South America are in developing stage. Relatively they are backward to India in areas like health, IT, remote sensing, biotechnology, etc. These said areas can serve best to Indian economy if they are harnessed well. Helping them in these areas will make Indian position firm on international platform where they will support Indian decisions.

Bilateral Investment:

Indian companies have found various areas in South America to invest in. Prominent among them is the mining industry. Other areas include IT, pharmaceutical, automobiles, steel industry, etc. Key players among them are ONGC Videsh, TCS, Mahindra Satyam, Reliance, etc.

  • Various bilateral agreements have been signed between both parties related to defense, science and technology, education, space, biotechnology, technical cooperation, etc. 

Our relations with South American countries are very friendly & non-disputed. Though both sides have increased bilateral relations but there still exist a lot of areas where both sides can cooperate. South America represents a developing world & by helping them India can became a major player in international arena.

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