Chile FTA: India seeks to balance critical minerals access with agri protection

As India seeks to conclude its Free Trade Agreement (FTA) negotiations with Chile, it is facing a balancing act between securing access to the country's critical minerals and protecting its domestic agricultural sector, individuals aware of the matter stated.

Key points

• The two sides are therefore exploring ways to accommodate their respective interests within the proposed Comprehensive Economic Partnership Agreement (CEPA).
• Sources remarked Brazil has become somewhat more "inward-looking" against the backdrop of the current geopolitical situation, particularly in relation to the US.
• Chile is a major producer of some agricultural and horticultural products such as walnuts and salmon.
• The two countries are in the final round of negotiations and are looking to conclude the accord next month.

While India remains cautious regarding opening up its farm sector, the residents noted, chile is seeking greater market access in India for a handful of agricultural and horticultural products.

"Chile is a major producer of some agricultural and horticultural products such as walnuts and salmon. So, they are pushing for those 7-8 items. India is trying to balance their demands and additionally secure access to critical minerals, " a source stated.

Meanwhile, the two countries are in the final round of negotiations and are looking to conclude the accord next month. Nevertheless, a administration source noted Chile's existing law does not allow it to provide preferential treatment to individual countries for critical minerals.

In practice, the two sides are therefore exploring ways to accommodate their respective interests within the proposed Comprehensive Economic Partnership Agreement (CEPA). "The talks are stuck around market access from their side, " a administration source stated.

After China's restrictions on critical mineral exports, India has been seeking to diversify its supply chains and secure alternative sources of critical minerals, including rare earths, from countries throughout the world.

India and Chile are negotiating an upgrade of their existing preferential trade agreement into a CEPA, with securing access to critical minerals and building resilient rare earth supply chains emerging as key strategic priorities.

India is additionally looking to expand its existing preferential trade agreement with the Mercosur bloc, comprising Argentina, Bolivia, Brazil, Paraguay and Uruguay, with a focus on critical minerals and rare earths.

Sources remarked Brazil has become somewhat more "inward-looking" against the backdrop of the current geopolitical situation, particularly in relation to the US. Argentina, nevertheless, has expressed interest in a side agreement with India and is pushing to conclude negotiations within six months.

Taken together, the developments around chile FTA: India seeks to balance critical minerals access with agri protection point to a situation that is still moving, and the coming days should bring more clarity.