Chile and India are set to sign a revised Preferential Trade Agreement (PTA) in order to dramatically increase the number of export products that will benefit from preferential tariffs.
The amount of products covered under the agreement will rise to 2,000, a substantial increase from the 100 agreed in the countries’ original 2005 PTA.
Chile’s Senate President, Guido Girardi, led the delegation of representatives who were invited to tour the subcontinental nation by the Indian government.
Girardi highlighted Chile’s enormous potential for renewable energies and commitment to obtain 20 percent of its power from renewable sources.
“In the next 20 years, 20 percent of power consumed in our country will come from renewable energy. It may be from tidal energy or through thermal energy,” said Girardi, in an appeal to Indian companies to invest in the emerging industry.
The senate president told India’s industry leaders that the Chilean mining sector will require investments of up to US$50 billion in the coming decades, and that such huge mining operations would require new sources of energy, particularly solar.
In response, the Chairman of the Confederation of Indian Industry, Mr T.T. Ashok, highlighted India’s potential as an exporter of wind, solar, biomass and biofuel technologies due to its investment in manufacturing and research.
And while the Chilean delegation called for more investment in copper – the largest current contributor to the country’s economy – it also touted what many see as the next golden child of Chile’s mining industry: lithium.
Used in batteries, lithium is crucial to the production of technological gadgets like cell phones, mp3 players and cameras, but is also increasingly employed in developing the next generation of cars.
The delegation encouraged India to use Chilean minerals to step up its production of electrically powered vehicles, noting that Japan employs a similar strategic relationship with Argentina.
“We want to have the know-how and human capital [for lithium],” said Senator Pablo Letelier, another member of the Chilean delegation. “Chile has to react very rapidly in this area since it is becoming more competitive.”
The delegation also highlighted how the country’s access to the Pacific Ocean had allowed trade to flourish with the world’s other giant of developing economies – China.
Chile’s increasing economic ties with emerging economies reflects the findings of a recent report by global accountancy firm Ernst & Young, which predicted that developing countries would provide up to 70 percent of global growth in 2012, and that Chile would be well positioned to exploit this trend.