The agreement, at present, cuts tariffs on 600 items
Chennai, March 10
Wine, a product which Chile takes pride in exporting, does not figure in the list of items allowed by India for imports from the South American country under the Preferential Trade Agreement (PTA) signed between the two on Wednesday.
India imposes a duty of around 200 per cent on imported wine and Chileans, who believe their wine is as good as the French, if not better, are keen on tapping the Indian market.
"I would very much like to have wine included, but this (PTA) is only the first step," the Ambassador of Chile in India, Mr Jorge Heine, who signed the agreement on behalf of Chile, told
Business Linein response to a question.
Toast to ties
Wine or not, the PTA that cuts tariff on some 600 items, does raise a toast to the growing economic relationship between the two countries. The significance of the PTA lies not in duty cuts, but what it is expected to lead to. Chile anyway has a very low peak customs rate 6 per cent and duty cuts from this level is only but a small benefit. The agreement is expected to mature into a fuller Free Trade Agreement and become a signpost for other Latin American countries, and over time blossom into a comprehensive relationship, sweeping investments and defence co-operation.
Last year, Chile sent the chiefs of all the three services to visit India. The Indian Defence Minister also has visited Chile. Both the countries are expected to put a `Defence attache' in their respective embassies, to take the matters further.
Chile is keen on buying helicopters and naval equipment from India, sources in the Ministry of External Affairs say.
Chile is the first country in Latin America that India has signed a PTA with. (Last year, India did sign a PTA Mercusor a trade block comprising Brazil, Argentina, Paraguay and Uruguay but it yet to come into force because some countries of Mercusor are yet to ratify the same.)
Incidentally, Chile is the country with the highest number of free trade agreements it has signed pacts with over 40 other nations. Last year, this country of 15 million people, exported $40 billion worth of goods, more than half of India's exports. Composition of exports has also changed. Once upon a time, 85 per cent of its exports used to be of copper, now the metal accounts for only 35 per cent.
Chile is also advanced in agriculture, with better technology for quality control and sanitation. With a view to tapping this, the Indian Minister for Agriculture is expected to visit Chile shortly.
Moreover, Chile (like Argentina) allows foreigners to buy lands. There are vast tracts of forestlands in Chile which Indian companies could buy and bring back forest produce. The Chinese are understood to be doing this in a large measure.