Trade

International Trade

India-MERCOSUR PTA

1. MERCOSUR is a trading bloc in Latin America comprising Brazil, Argentina, Uruguay and Paraguay. MERCOSUR was formed in 1991 with the objective of facilitating the free movement of goods, services, capital and people among the four member countries. It is the third largest integrated market after the European Union (EU), North American Free Trade Agreement (NAFTA).
    
2. A Framework Agreement had been signed between India and MERCOSUR on 17th June 2003 at Asuncion, Paraguay. The aim of this Framework Agreement was to create conditions and mechanisms for negotiations in the first stage, by granting reciprocal tariff preferences and in the second stage, to negotiate a free trade area between the two parties in conformity with the rules of the World Trade Organisation.
    
3. As a follow up to the Framework Agreement, a Preferential Trade Agreement (PTA) was signed in New Delhi on January 25, 2004. The aim of this Preferential Trade Agreement is to expand and strengthen the existing relations between MERCOSUR and India and promote the expansion of trade by granting reciprocal fixed tariff preferences with the ultimate objective of creating a free trade area between the parties.
    
4. The India-MERCOSUR PTA provides for five Annexes. These five Annexes had been finalized during six rounds of negotiations in order to operationalise the PTA. These have been signed between the two sides on March 19, 2005, upon the conclusion of G-20 Meeting in New Delhi. The five finalized Annexes are following.

• Annex I to the PTA - Offer List of MERCOSUR for tariff concession on Indian products in MERCOSUR. It contains 452 products.

• Annex II to the PTA - Offer List of India for tariff concession on MERCOSUR’s products in India. It contains 450 products.

• Annex III to the PTA - Rules of Origin

• Annex IV to the PTA - Safeguard Measures

• Annex V to the PTA - Dispute Settlement Procedure (DSP)

5. The major products covered in Indian offer list are meat and meat products, organic & inorganic chemicals, dyes & pigments, raw hides and skins, leather articles, wool, cotton yarn, glass and glassware, articles of iron and steel, machinery items, electrical machinery and equipments, optical, photographic & cinematographic apparatus
    
6. The major product groups covered in the offer list of MERCOSUR are food preparations, organic chemicals, pharmaceuticals, essential oils, plastics & articles, rubber and rubber products, tools and implements, machinery items, electrical machinery and equipments
    
7. India – MERCOSUR PTA came into effect from 1^st June, 2009.