India and Chile Launch CEPA Talks to Deepen Economic Ties

By: Team India Tracker

India’s exports to Chile have seen consistent growth since 2009, except for a temporary dip in 2014 due to Chile’s introduction of a carbon tax on diesel vehicles, which impacted Indian automobile exports.

In a significant step towards strengthening bilateral economic relations, India and Chile officially launched negotiations for a Comprehensive Economic Partnership Agreement (CEPA) on May 26, 2025. The talks follow the signing of the Terms of Reference earlier this month, on May 8, during a high-level dialogue between the two countries.

Commerce Secretary Sunil Barthwal inaugurated the opening round in the presence of Chile’s Ambassador to India, H.E. Juan Angulo. Barthwal underscored the potential of the CEPA to deepen economic engagement and bolster global value chains between the two nations. The initiative builds on momentum generated during the State Visit of Chilean President Gabriel Boric Font to India in April 2025, where both nations reaffirmed their commitment to enhanced trade cooperation. President Boric described India as a "priority partner" in Chile’s global trade strategy and emphasized the need for diversified economic ties.

The Chilean delegation, led by Chief Negotiator Mr. Pablo Urria from Chile's Ministry of Foreign Affairs, included 17 officials. India’s negotiating team was headed by Shri Vimal Anand, Joint Secretary at the Department of Commerce.

Talks during the first round spanned 17 thematic areas, ranging from trade in goods and services to sustainable development, investment cooperation, MSME support, women’s economic empowerment, and the trade of critical and strategic minerals. Key regulatory areas such as rules of origin, sanitary and phytosanitary measures, and dispute resolution were also addressed.

Source: Chile Customs Agency

India’s exports to Chile have seen consistent growth since 2009, except for a temporary dip in 2014 due to Chile’s introduction of a carbon tax on diesel vehicles, which impacted Indian automobile exports. However, the sector later rebounded strongly. In the following years, trade between the two countries experienced a decline due to the global economic slowdown and internal social unrest and labor issues in Chile. Despite these setbacks, bilateral trade has since made a solid recovery.

India’s exports to Chile are broad-based and include motor vehicles, pharmaceutical products, chemicals, iron and steel goods, man-made and cotton textiles, ready-made garments (RMG) including accessories, auto components, electrical machinery, leather items, rubber products, bulk drugs and intermediates, leather footwear, aluminium products, ceramics, and garments made from man-made fibers.

The next round of negotiations is scheduled for July or August 2025, preceded by intersessional virtual discussions to resolve outstanding issues. Both sides expressed commitment to a balanced, ambitious, and mutually beneficial agreement that promotes inclusive growth and enhances bilateral trade and investment. Stakeholder consultations and industry feedback will guide the modalities of the negotiations, with officials from both countries affirming a collaborative approach to ensure the CEPA delivers tangible economic gains.

India and Chile enjoy a strong strategic partnership, marked by warm and friendly relations that have grown steadily through high-level exchanges. The foundation of their economic cooperation was laid with the signing of a Framework Agreement in January 2005, followed by a Preferential Trade Agreement (PTA) in March 2006. Since then, bilateral economic and commercial ties have remained robust and continue to expand.

In September 2016, the two countries signed an expanded PTA, which came into effect on May 16, 2017. Further strengthening the relationship, both sides agreed in April 2019 to pursue another round of PTA expansion, holding three negotiation rounds between 2019 and 2021.

To take this partnership to the next level, India and Chile committed to negotiating a Comprehensive Economic Partnership Agreement (CEPA). The goal is to unlock the full potential of bilateral trade, enhance employment opportunities, and promote investment and exports. This initiative follows the recommendations of the Joint Study Group (JSG) formed under the 2005 Framework Agreement. The JSG’s final report was signed on April 30, 2024.