Commerce secretary Rahul Khullar heads to LatAm in Panama and Colombia for FTA talks
Economic Times, India
Commerce secretary Rahul Khullar heads to LatAm in Panama and Colombia for FTA talks
By Amiti Sen, ET Bureau
31 August 2011
NEW DELHI: After shunning Latin America two years ago, the government is now seeking closer economic ties with the region as part of its initiative to diversify markets for Indian merchandise.
Commerce secretary Rahul Khullar will be visiting Latin America this week to explore avenues of improving economic cooperation with the countries of the region. Khullar, who will be leading a high-level business delegation, will also look into the possibility of signing free trade agreements (FTAs) with Panama and Colombia, which could serve as a gateway to Latin America.
"The visit is to send a signal to the countries that India is serious about doing business with them," Khullar told ET.
FTAs are on the agenda although the idea is still at an exploratory stage, a commerce ministry official said.
Khullar is scheduled to hold talks with his counterparts in Panama and Colombia. He will also call on the trade ministers of the two countries.
The effort to engage Latin American countries is in line with India’s plan to diversify markets for its goods and not be overly dependent upon the US and EU, Khullar added.
The global financial crisis of 2008 has forced the government to look beyond the US and EU—the traditional markets for Indian goods—which faced the brunt of the crisis.
Latin American countries had proposed FTAs with India way back in 2009, but at that time India considered them too small.
The global crisis, however, has brought home the point that India needs to engage with every one.
"There has been a phenomenal growth in our exports to the region over the past few years," the commerce ministry official quoted earlier said. "We have to exploit the potential it holds."
India’s exports to Latin America grew 72.5% to $10.71 billion in 2010-11, as against an overall export growth of 37.1% to $246 billion.
The region’s share in total exports increased to 4.3% during the year compared with 3.5% in 2009-10.
Share of the EU and the US markets, on the other hand, slipped to 30.2% in 2010-11 (April-December) as against 31.7% in the previous fiscal.
Engineering exports have been the biggest gainers with shipments to Latin America registering an 80% growth to $2.04 billion in 2010-11, compared with $1.25 b in 2009-10.
"We started focusing on the region when the global financial crisis started as our major markets were in the EU and the US and we felt the need to diversify," said Suranjan Gupta, director, Engineering Export Promotion Council.
