India Eyes Critical Minerals Access in Chile and Peru Trade Deals
India is negotiating free trade agreements (FTAs) with Chile and Peru, focusing on securing access to critical minerals. The agreements aim to provide India with preferential exploration rights and stable pricing for resources like gold, lithium, copper, and molybdenum. Negotiations with Chile have progressed to the second round, while talks with Peru are expected to conclude by 2025. These strategic moves are part of India's broader effort to secure supply chains, diversify trade partnerships, and prevent market price manipulation in critical minerals.
*this image is generated using AI for illustrative purposes only.
India is making strategic moves to secure its supply chains for critical minerals through potential free trade agreements (FTAs) with Chile and Peru. These agreements, currently under negotiation, are expected to include dedicated chapters on critical minerals, highlighting India's focus on resource security.
Key Minerals in Focus
India's interest in these Latin American countries is driven by their rich mineral resources:
- Peru: Gold
- Chile: Lithium, copper, and molybdenum
The agreements aim to provide India with preferential exploration rights and stable pricing for these crucial resources, ensuring a steady supply for India's growing industrial needs.
Progress in Negotiations
- Chile: The second round of FTA negotiations concluded recently, with the next round scheduled for late October.
- Peru: Plans are in place to conclude a trade pact with India by 2025, after eight rounds of negotiations.
Copper: A Critical Focus
Copper stands out as a particularly important mineral in these negotiations:
- Indian companies can already participate in Chilean copper mine auctions.
- India's per capita copper consumption is less than half that of developed countries, indicating significant growth potential.
- China currently pays premiums for copper ore at refined copper rates, potentially enabling future trade monopolization.
Strategic Importance
These trade deals are part of India's broader strategy to:
- Secure future supply chains for critical minerals.
- Diversify its trade partnerships amid global geopolitical uncertainty and economic slowdowns.
- Prevent market price manipulation by single countries.
Expanding Trade Horizons
India is not limiting its focus to Chile and Peru. The country is actively pursuing trade deals with multiple Latin American countries, signaling a significant shift in its international trade strategy.
Conclusion
As India continues to grow its economy and industrial base, securing access to critical minerals becomes increasingly important. The potential FTAs with Chile and Peru represent a strategic move to ensure long-term resource security while also expanding India's economic influence in Latin America. These agreements, once finalized, could mark a new chapter in India's international trade relations and resource management strategy.
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