NEW DELHI — India’s trade minister Piyush Goyal told reporters on Tuesday that a free‑trade agreement (FTA) with Peru is “not on the immediate horizon.” The comment came as a senior Indian delegation prepared to travel to Canada for the next round of negotiations on the India‑Canada trade agenda, underscoring a shift in priority toward the North‑American partner.
What happened
During a press briefing in New Delhi, Goyal was asked about the status of several of India’s pending trade talks. He said the India‑Peru FTA “is not on the immediate horizon” and noted that the two sides have yet to resolve “key issues such as market access for agricultural products and rules of origin.” He added that the upcoming Indian team’s visit to Canada will focus on “finalising pending items in the ongoing India‑Canada trade talks,” rather than on reviving the Peru negotiations. Goyal did not provide a specific timeline for when the Peru talks might be revived, but said the government remains “open to dialogue” with Latin American partners.
Why it matters
An FTA with Peru would be India’s first comprehensive trade pact with a South‑American nation, potentially opening new markets for Indian manufacturers and services while granting Peruvian exporters better access to India’s large consumer base. The delay, however, signals that the government is prioritising negotiations that promise quicker or larger economic returns. Canada represents a market of roughly 38 million consumers and a strategic partner in technology, minerals and services, sectors that have featured prominently in India’s recent trade outreach.
The postponement also highlights persistent challenges in India’s broader FTA strategy. Agricultural concessions and rules of origin—both cited by Goyal—have repeatedly stalled talks with Latin American countries, where protectionist policies and divergent standards often clash with India’s demand for broader market access. A delay in the Peru deal could affect India’s ambition to deepen economic ties across the Global South, a pillar of its “Act East” and “Neighbourhood First” policies.
Background and context
India and Peru signed a “Framework Agreement on Trade and Investment” in 2013, laying the groundwork for a full‑scale FTA. Formal negotiations on a comprehensive agreement began in 2019, with both sides expressing optimism about expanding trade in sectors such as textiles, pharmaceuticals, and agro‑products. However, progress has been uneven.
Key sticking points have included:
* Agricultural market access – Peru seeks greater entry for its quinoa, coffee and fishery products, while India pushes for reduced tariffs on its pulses, spices and dairy exports.
* Rules of origin – Both parties must agree on criteria that determine which goods qualify for preferential treatment, a technical area that often requires detailed bilateral alignment on production processes and supply‑chain documentation.
In parallel, India has been advancing FTAs with other partners. The India‑Australia Economic Cooperation and Trade Agreement (signed in 2022) and the India‑UAE Comprehensive Economic Partnership Agreement (signed in 2023) illustrate a pattern of pursuing deals that combine market size with strategic alignment. The India‑Canada negotiations, launched in 2022, have progressed to a “next round” of talks, with officials slated to meet in Ottawa later this month.
Competing claims and uncertainty
While Goyal’s remarks suggest a de‑prioritisation of the Peru pact, other officials have previously signalled a willingness to move forward. A senior Ministry of Commerce official, speaking at a trade conference in 2023, had indicated that “both sides are committed to resolving agricultural issues within the next fiscal year.” No official response has been issued to reconcile that earlier optimism with Goyal’s current assessment.
Industry groups also present divergent views. The Confederation of Indian Industry (CII) has publicly welcomed the prospect of an India‑Peru FTA, citing potential gains for Indian exporters of processed foods and textiles. Conversely, the Indian Farmers’ Association has warned that any concession on agricultural tariffs could expose domestic producers to “unfair competition,” a claim that remains unsubstantiated in the public record.
The lack of a concrete timeline adds to the uncertainty. Goyal’s statement that the government remains “open to dialogue” is standard diplomatic language and does not clarify whether negotiations will be formally re‑opened, placed on hold, or abandoned.
What to watch next
* Outcome of the India‑Canada talks – The delegation’s visit to Ottawa is scheduled for the week of 15 July. Any signed “letter of intent” or “road‑map” could cement Canada as a higher‑priority partner, further sidelining the Peru negotiations.
* Official follow‑up from the Ministry of Commerce – A press release or briefing within the next 30 days may outline specific next steps for the Peru talks, if any, and could reveal whether the “key issues” identified by Goyal have been narrowed down.
* Parliamentary scrutiny – Members of Parliament on the Standing Committee on Commerce have previously called for a status report on all pending FTAs. Their upcoming report, expected in September, may include a detailed assessment of the Peru negotiations.
* Stakeholder lobbying – Agricultural exporters and consumer‑goods manufacturers are likely to intensify lobbying efforts. Monitoring statements from bodies such as the Agricultural and Processed Food Products Export Development Authority (APEDA) will indicate whether pressure builds for a renewed push.
Conclusion
Minister Piyush Goyal’s candid assessment that an India‑Peru free‑trade agreement is “not on the immediate horizon” reflects the complex calculus of India’s trade diplomacy. While the prospect of deeper ties with Peru remains on the table, unresolved agricultural market‑access demands and divergent rules‑of‑origin standards have stalled progress. At the same time, the government is channeling diplomatic and technical resources toward the India‑Canada negotiations, a partnership that promises larger immediate economic dividends and strategic alignment.
The coming weeks will reveal whether the Peru talks are merely on pause or facing a longer‑term deprioritisation. For Indian exporters eyeing South‑American markets, the delay underscores the importance of diversifying trade strategies while awaiting clearer signals from New Delhi.
Sources
– The Hindu, “Do not see India‑Peru FTA happening anytime soon: Piyush Goyal,” https://www.thehindu.com/news/national/do-not-see-india-peru-fta-happening-anytime-soon-piyush-goyal/article71182095.ece
Story synopsis gathered from: The Hindu – National — source
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