- As the popular saying goes, every country worth its salt would leave no stone unturned in turning protectionist to ensure it not only safeguards the country’s resources to sustain the economy and growth, but also reaches out to similarly positioned countries serving mutual interests. Since the modernity defined present-day world is growing at such a dynamic pace, keeping in line with the fast-emerging technology-driven initiatives, the trade aspects too have assumed critical importance to push ahead with the growth prospects. Mind you, the information-technology-driven modern world has become boundaryless, almost blurring the hitherto traditional boundaries separating nations. The very mention of trade sends alarms through all nations now.
PC: Deutschlandfunk
- Why? With the advent of Donald Trump as the president of the United States of America, the buzz surrounding the trade tariffs has become most synonymous with how international trade is being governed around the world. The disruption wrought by the announcement of a tariff war from the desk of the president has been monumental, to say the least. The reason behind such a move by Trump is widely known. As such, it makes a prudent move to know what India must do to stay ahead in the tariff game. To begin with, it must shed its protectionist mindset and trade more with resource-rich South America. Thus, PM Modi’s ongoing five-nation tour includes Argentina and Brazil, is not a trivia. These two key South American nations can be pivotal to the continent. Simple.
PC: IAS Gyan
- While India-South America trade has been steadily growing, it’s far below its potential. This has much to do with our unambitious approach to the region. True, India has a preferential trade agreement (PTA) with MERCOSUR bloc that includes Brazil, Argentina, Uruguay, Paraguay, and Bolivia. The idea was that the PTA would be gradually expanded and upgraded to a free trade agreement (FTA). However, progress has been slow, and India’s exports to Latin America in FY2025 stood at just $15.17bn – less than 2% of the region’s total imports. But trade is back on the agenda during Modi’s visits, and rightly so. While one still hopes that an India-US trade deal can be clinched, New Delhi must be prepared for all eventualities.
PC: India Briefing
Most importantly, with Trump keen on using tariffs as a strategic weapon to achieve geopolitical goals – take the Lindsey Graham-proposed bill to hit countries buying Russian oil with a 500% tariff – India must diversify its trade relations. South America is a natural resources powerhouse. With vast deposits of oil, gas, copper, lithium, and rare earths, it can power India’s industrial growth, advance critical sectors like EV batteries, and bolster food security. India must expand its diplomatic bandwidth and take a courageous approach to trade by casting away the protectionist mindset and being ready to compete. That’s the only way beneficial FTAs can be worked out. China has a huge presence in Latin America, and the latter is looking for balance. Perfect time to step up.
