India-Chile Comprehensive Economic Partnership Agreement (CEPA) Negotiations

Current Negotiation Status

Negotiations for the CEPA between India and Chile have encountered hurdles due to Chile's demands for market access on certain sensitive products. Both nations are eager to resolve these issues and finalize the trade deal by October.

Chile's Market Access Demands

• Chile is seeking market access for products such as: 
  • Gold
  • Salmon
  • Wine
  • Apple
  • Walnut
  • Avocado
  • Other fruits and berries
• Chile desires maximum possible concessions on these products.

India's Response

• India may consider concessions on fruits and wine through: 
  • Quotas
  • Minimum import-price mechanism to keep landing prices above domestic prices

Tariff Concessions

• Chile is offering tariff concessions to India on over 90% of tariff lines.
• India is likely to offer duty cuts on approximately 70% of lines, focusing on products of Chile's interest.
• Chile is particularly interested in securing market access for its wine exports.

Political Factors

• Chile's general election and government change delayed negotiations.
• Chilean President Jose Antonio Kast's administration is keen on finalizing the agreement.

Progress and Further Negotiations

• Negotiations are 80% complete, with remaining issues on critical minerals and market access.

India's Broader Strategic Initiatives

• India is negotiating trade deals with other Latin American countries, including: 
  • Peru
  • MERCOSUR bloc (Argentina, Brazil, Paraguay, Uruguay, Bolivia)
• The aim is to expand the preferential trade agreement with MERCOSUR to a full-fledged FTA.

Strategic Importance

• India seeks to diversify its sources of critical minerals beyond China, especially copper and lithium.
• China controls nearly 70% of the global supply chain of rare-earth minerals, causing disruptions last year due to export restrictions.

Economic Engagement

• India's imports from Latin America increased by 44% in FY26 to $34.62 billion.
• This growth was driven by an 82% rise in copper ore shipments and the start of gold imports from the region.
• India exported goods worth $16.36 billion to Latin America in the last financial year.