India, Paraguay to work together to expand South America trade bloc

Prime Minister Narendra Modi told the visiting Paraguay President Santiago Pena Palacois on Monday that both the countries could work together to further expand the preferential trade agreement with other South American countries and their trading bloc MERCOSUR.

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MERCOSUR (Mercado Común del Sur, or Common Market of the South) is a trading bloc in South America, comprising Argentina, Brazil, Paraguay, and Uruguay. It was founded in 1991 with the aim of establishing a customs union and a common market, allowing for the free movement of goods, services, capital, and people among member countries.

“We see new opportunities for cooperation in areas such as digital technology, critical minerals, energy, agriculture, healthcare, defence, railways, space, and overall economic partnership. We have a Preferential Trade Agreement with MERCOSUR. We can work together to further expand it,” the Prime Minister said in his opening remarks during the delegation-level talks with the Paraguay delegation led by President Pena Palacois.

Paraguay President Pena Palacois, is on a three-day a state visit to India, accompanied by a high-level delegation, including ministers, senior officials and business representatives. Paraguay President Pena Palacois is on his first visit to India and the only Paraguay President to visit India.

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The Prime Minister asserted that “India and Paraguay stand united in the fight against terrorism.”

He added, “There is an immense possibility of cooperation to fight against shared challenges such as cybercrime, organised crime, and drug trafficking…. India and Paraguay are integral parts of the Global South. Our hopes, aspirations, and challenges are similar. And this is why we can learn from each other’s experiences to deal with these challenges effectively.”

Recalling that he was pleased that India could extend support to Paraguay by sharing its vaccines during the Covid pandemic,” the PM said: “I am confident that your visit will add new strength to the pillars of trust, trade, and close cooperation in our relations. It will also add new dimensions to India-Latin America relations. Last year, I attended the CARICOM (Caribbean Community) Summit in Guyana. We discussed enhancing cooperation on many subjects. I think that we can work together with Paraguay and all Latin American countries in all these areas.”

Additionally, the Ministry of External Affairs(MEA) Secretary East P Kumaran informed the two sides also signed an MOU in dairy and agriculture. Paraguay produces food which is more than its requirement of 7 crore people, he added.

He informed that the two leaders also discussed enhancing cooperation in the fields on agriculture, pharma, technology, renewable energy, health, critical minerals, railways and people to people contacts. The two sides alos agreed over the establishment of Joint Commission Mechanism (JCM). Two-way trade between India and Paraguay was worth $477 million during 2022-23, with Indian exports accounting for $317 million. India’s main exports were motor vehicles, agro-chemicals, auto parts and pharmaceutical products, while the key imports from Paraguay were soya oil, iron and steel, aluminium and animal products.