India and Mexico Set to Launch Preferential Trade Agreement Negotiations

India and Mexico will formally launch negotiations for a preferential trade agreement (PTA) with the signing of the Terms of Reference (ToR) during Commerce Secretary Rajesh Agrawal’s two-day visit to Mexico City beginning October 26. Commerce and Industry Minister Piyush Goyal said Mexico is keen on an early-harvest arrangement to liberalise trade in selected goods faster. “Mexico is very keen to have an early harvest,” Goyal said in The Hague. Early harvest is an interim agreement that could allow the two countries to reduce or eliminate duties on goods where neither side has major sensitivities faster, without waiting for a comprehensive deal. The proposed PTA will focus on liberalising trade in identified goods between the two countries. The ToR will provide the framework for negotiations, which are expected to identify products on which tariff concessions can be offered. Goyal also updated on India’s broader trade negotiations, saying a deal with Chile was “quite ripe for conclusion” and talks with Canada were making “very good progress”. The sixth round of talks with Canada on Comprehensive Economic Partnership Agreement (CEPA) is expected in early November with both sides aiming to conclude negotiations by the end of this year. Negotiations with the Southern African Customs Union (SACU) have only recently begun and could take some time, he said. Discussions on expanding India’s existing preferential trade arrangement with Mercosur could also be accelerated with the return of Luiz Inácio Lula da Silva as President of Brazil. Agrawal arrived in Mexico City on October 26 for meetings with the Mexican government and business community to advance bilateral trade and investment ties. Ahead of the ToR signing, the Indian Embassy in Mexico, in partnership with the Indmex Council, brought together Indian and Mexican business leaders to explore opportunities, address challenges and strengthen commercial linkages. Agrawal highlighted the complementarities between the two economies, India’s growth of around 7% and the untapped potential for trade, investment and business partnerships. He also emphasised the importance of policy stability, predictability and a rules-based trading environment. The proposed PTA is expected to create opportunities for businesses in both countries through tariff concessions on selected goods and strengthen supply-chain links.