India, Chile look to cross hurdles on market access, critical minerals to seal trade pact

With talks for an India-Chile Free Trade Agreement (FTA) at an advanced stage, government sources have indicated that Commerce Secretary Rajesh Agrawal is slated to travel to Chile for a day during his visit to Latin America from 24th to 28th August to expedite talks on the pending issues.Government sources pointed out that both sides are looking to balance each other’s concerns, noting that the talks are “stuck around market access from their (Chile’s) side,” and on the issues of critical minerals from India’s side.On the proposed talks, government sources noted: “The new government in Chile is keen on the agreement. Both sides are looking to find solutions to the pending issues.” Bilateral trade increased from $5.38 billion in 2025 from $3.84 billion in 2024. In 2025, Indian exports to Chile increased 14% to $1.41 billion while imports from Chile increased 53% to $3.97 billion, primarily due to increased gold imports from Chile.A Preferential Trade Agreement (PTA) has existed between India and Chile since September 2007, with both sides having agreed to give fixed tariff preferences to each other and three Annexes relating to the Rules of Origin, Preferential Safeguard Measures and Dispute Settlement Procedures. The India-Chile PTA covers 474 tariff lines, with the scope having been expanded to 2829 tariff lines in September 2016.While India had offered to provide fixed tariff preferences ranging from 10% to 50% on 178 tariff lines at the eight-digit level to Chile, Chile had offered tariff preferences on 296 tariff lines at the eight-digit level with a margin of preference ranging from 10% to 100%.India’s exports to Chile comprise automobiles, pharmaceuticals, electric machinery and equipment, clothing, textiles, footwear, chemicals, agri and food products, and iron and steel products. India’s imports from Chile are largely bulk minerals and ores (copper concentrate, molybdenum, iodine, and gold), inorganic chemicals and agri products.In September 2025, government sources had told CNBC-TV18 that India’s potential trade pacts with Chile and Peru may include a separate chapter on critical minerals for the 1st time. India imports Gold from Peru, and Lithium, Copper, and Molybdenum from Chile, and is aiming to seek preferential rights in exploration as well as assured and enduring rates for these metals and minerals to secure supply chains for the future.While Indian companies are already eligible to participate in mineral auctions for Copper mines in Chile, government sources had earlier pointed out that India’s current per capita consumption of Copper is less than half that of developed countries and will grow substantially as the country develops further.While India is trying to secure its future supply chains, Peru and Chile are trying to diversify their trade destinations to prevent a single or a few countries from stockpiling their mineral deposits to control market prices in future. Sources explained that despite the sale of Copper ore at the rates of refined Copper, China is paying a premium by absorbing the costs of extraction and refining, which may allow monopolisation of trade in the commodity in future(Edited by : Asmita Pant)

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