It is worth noting that Latin America’s exports and imports represented 5.90 percent and 5.87 percent of the global trade total, respectively. The trade balance of Latin America holds a crucial position in determining the economic stability of the region. A positive trade balance, characterized by exports exceeding imports, has the potential to stimulate economic growth by increasing foreign exchange earnings. This surplus in trade can also lead to job creation as industries expand to meet the growing demand for exports.
In contrast, US$673 billion in imports and US$431 billion in exports were recorded by India to the global market in 2023, with US$22.93 billion in imports from Latin America and US$20.09 billion in exports to the region. These figures demonstrate India’s active participation in the global economy, both as a seller and a buyer of goods and services. The trade data reflects India’s position as a key player in international trade, with a substantial presence in various markets around the world. India’s trade figures are shown in Info-graph No. 02.
Top 10 group commodities, India exports and imports from Latin America
In the year 2023, India exports petroleum oils and oils derived from bituminous minerals (excluding crude)—HSN 2710 totalling US$2127. 23 million—followed by motor cars and other motor vehicles primarily designed for transportation—HSN 8703 valued at US$1916.97 million, insecticides, rodenticides, fungicides, herbicides, anti-sprouting products, and plant-growth regulators—HSN 3808 valued at US$1374. 48 million, among others, as shown in Info-Graph No. 03.
Conversely, the top 10 group commodities imported into India from Latin America are petroleum oils and oils obtained from bituminous minerals—HSN 2709, valued at US$5875.62 million—followed by gold, including gold plated with platinum, unwrought—HSN 7108, valued at US$5776.54 million, and soybean oil and its fractions, whether or not refined (excl. chemically modified)—HSN 1507, US$3536.67 million, as shown in Info-Graph No. 04.
India’s top 10 trading partners in Latin America
Brazil serves as India’s main trading partner in the Latin America region. In the year 2023, India’s exports to Brazil were valued at US$6,670 million in commodities, while its imports from Brazil totalled US$6,125 million, as demonstrated in Info-graphic No. 3 and 4. After Brazil, the subsequent trading partners are Mexico—US$5,283 million, Colombia—US$1,198 million, Chile—US$1,169 million, Argentina—US$996 million, Peru—US$916 million, Guatemala—US$522 million, Ecuador—US$471 million, Uruguay—US$402 million, and the Dominican Republic—US$328 million in exports from India, as shown in Info-graph No. 05.
Conversely, imports into India from Mexico amounted to US$3,034 million, Colombia—US$2,878 million, Peru—US$2,766 million, Argentina—US$2,662 million, Chile—US$1,376 million, Bolivia—US$1,310 million, Ecuador—US$871 million, Panama—US$436 million, and the Dominican Republic—US$422 million, as shown in Info-graph No. 06.
Time to reactivate the “Focus: LAC” Programme
The burgeoning trade relationship between India and Latin America, which reached an impressive US$43.22 billion in 2023, highlights the potential for growth and mutual benefit in this dynamic partnership. While significantly smaller than the colossal US$487.2 billion trade that China enjoys with the region. India’s trade relations with Latin America have historically not been as strong as China’s. Despite efforts to increase economic ties and strengthen partnerships, India continues to fall behind China in terms of imports and exports with countries in the Latin American region. This disparity can be attributed to various factors such as China’s established presence in the region, its larger economy and trade volume, as well as its strategic investments and alliances with Latin American countries. In order to bridge this gap and enhance its trade relations with Latin America, India may need to explore new opportunities, foster stronger diplomatic relations, and invest in infrastructure and trade agreements (FTA and PTA) to increase its presence and competitiveness in the region.
In the upcoming five years, India might aim for $100 billion bilateral trade. This is possible if the government, industry associations, export promotion councils, and Indian exporters aggressively and methodically step up their export promotion efforts with adequate financial support.
In November 1997, India’s Ministry of Commerce and Industries initiated a Trade Promotion Programme “Focus:LAC”, to strengthen trade links with the Latin America region’s for expanding importance. The program has been reviewed from time to time and has been extended up to March 2019. The Ministry of Commerce and Industries should reactivate the “Focus:LAC” programme. The Focus:LAC programme can be broadly categorized as follows: Institutional mechanism, Improved market access, and Economic infrastructure facilities.
India’s increasing engagement signifies a strategic shift towards diversifying economic ties and fostering collaborative ventures. This emerging alliance not only creates opportunities for enhanced trade but also promotes cultural exchanges and shared innovations that can strengthen both regions. As India continues to actively explore opportunities in Latin America, it is positioning itself to achieve even greater success.
The author is CEO of Grupo 108, also a Latin America Expert, contact [email protected]
Disclaimer: Views expressed are personal and do not reflect the official position or policy of The Financial Express Online. Reproducing this content without permission is prohibited.
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Publish date : 2024-12-26 19:41:00
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