India and South American bloc MERCOSUR are likely to include services in their expanded trade agreement, while the two sides are also planning a special cooperation framework for critical minerals, government sources told TNIE.
“We are aiming to have services trade included under the deal. Instead of an FTA, we are aiming for a more comprehensive preferential trade agreement (PTA). We are also planning to have critical minerals covered under a special framework,” a government official said.
India and MERCOSUR, comprising Argentina, Brazil, Paraguay, Uruguay and Bolivia, are currently negotiating to expand their existing PTA. Brazilian Development, Industry, Trade and Services Minister Márcio Elias Rosa met Commerce Minister Piyush Goyal on the sidelines of the G20 Trade Ministers’ Meeting on October 1. With the two sides having completed the terms of reference for broader negotiations, they are now looking to work on concrete proposals for an expanded trade agreement.
The India-MERCOSUR PTA is a targeted trade pact signed on January 25, 2004, and operationalised on June 1, 2009, to reduce customs duties on a limited list of products traded between India and the South American bloc. Currently, India provides preferential tariff concessions on 450 tariff lines, while MERCOSUR offers concessions on 452 tariff lines. The two sides now plan to expand the coverage by opening up more tariff lines to facilitate trade.
India and MERCOSUR formally launched negotiations on September 14, 2026, to expand and upgrade their existing agreement.
As India seeks to develop alternative supply chains for critical minerals and reduce its dependence on China, MERCOSUR could play an important role. During Brazilian President Luiz Inácio Lula da Silva’s last visit to India, the two sides signed a memorandum of understanding on rare earths and critical minerals to deepen cooperation in metals and minerals, particularly rare earth and critical minerals essential for economic development and clean energy technologies.