Peru is on the cusp of signing a Free Trade Agreement (FTA) with India, a move that could reshape trade dynamics and foster deeper connectivity between the two nations. This development, anticipated later this year, is not just about economics; it’s about forging a strategic partnership that leverages each country’s strengths. Peru’s Minister of Foreign Trade and Tourism, Desilú León, recently shared insights into this potential agreement during her visit to New Delhi for the 10th India-Latin America and the Caribbean (LAC) conclave. Her words paint a picture of opportunity and mutual growth.
The FTA negotiations have been progressing steadily, with seven rounds completed so far. León highlighted the productive discussions in 2023 and 2024, which have brought the two nations closer on key issues. The next round of negotiations is eagerly awaited, as it could be the final push towards sealing the deal. Peru is particularly interested in boosting exports in agriculture, technology, mining, and infrastructure. The country is renowned for its high-quality agricultural products, and the FTA could open up the Indian market for Peruvian superfoods like grapes, blueberries, avocados, and mangoes.
The technology services sector is another area ripe for collaboration. León emphasized the potential for partnerships between Peruvian and Indian companies in technology-intensive services. This could lead to innovative solutions and increased trade in digital services. The mining sector, a primary focus for both nations, offers opportunities for investment and trade in mining-related services. Peru is also keen on attracting Indian investments in infrastructure, with tax-free zones and other incentives on offer.
The FTA is expected to bolster bilateral trade in several vital sectors. In 2024, gold was Peru’s primary export to India, accounting for a significant portion of the total value. Other notable exports include copper, silver, and zinc. Tourism is another promising area where the FTA could drive growth. Peru is increasingly attracting the Indian film industry, with iconic locations like Machu Picchu featuring in Bollywood productions. The country is also positioning itself as a prime destination for destination weddings and joint film productions.
Beyond Machu Picchu, Peru boasts a wealth of lesser-known gems that appeal to Indian tourists. The country’s rich culture, history, and cuisine are drawing in travellers seeking unique experiences. León pointed out that Peru is working to promote these destinations, offering rich cultural and natural experiences. To facilitate this, Peru is simplifying its visa process for Indian nationals. León assured that the process is efficient, taking no more than three or four working days.
Air connectivity between India and Peru is currently limited, but discussions are underway to improve it. León mentioned that Turkish Airlines will begin operations in Peru by mid-2025, connecting Istanbul with Lima. Talks are also ongoing with Air India to establish direct flights. Peru’s strategic location, natural resources, and beauty make it an attractive investment destination for Indian businesses. With the FTA and initiatives to improve tourism and connectivity, bilateral trade and cultural exchanges are poised to rise significantly.
On the sidelines of the Raisina Dialogue 2025, Elmer José Germán Gonzalo Schialer Salcedo, Peru’s Minister of Foreign Affairs, highlighted key areas of cooperation with India. He emphasized Peru’s importance in the global mining market, particularly its lithium reserves. Peru’s lithium deposits, part of the Lithium Triangle with Bolivia and Chile, are more accessible, making extraction more efficient. This presents a significant opportunity for India, given the growing global demand for lithium in electric vehicles and renewable energy sectors.
However, Schialer also addressed the challenges Peru faces due to its lithium deposits being associated with uranium. The extraction process is complex, but the economic rewards are substantial. There is already interest from international companies, including those from India, looking at these opportunities. Defence cooperation is another area of potential collaboration. Schialer noted India’s advancements in defence technologies and expressed interest in exploring partnerships in this sector.
Peru is modernising its defence infrastructure, and this presents an opportunity for cooperation with India. Schialer’s optimism about the future of India-Peru ties is palpable. He sees tremendous potential for collaboration and is committed to making the most of these opportunities. This FTA is more than just a trade agreement; it’s a gateway to a deeper, more strategic partnership between two nations with complementary strengths. As negotiations continue, the world watches, eager to see how this alliance will unfold and reshape the global trade landscape. The mining sector, in particular, stands to gain significantly, with potential advancements in technology, investment, and trade. The stage is set for a new chapter in India-Peru relations, one that promises growth, innovation, and mutual benefit.
