Home Economy India, Mexico sign three pacts, to double trade

India, Mexico sign three pacts, to double trade


New Delhi : India and Mexico, the fast growing Latin American country that can be a gateway to the North American markets, Monday signed three pacts, including an extradition treaty, and agreed to double bilateral trade to around $4 billion by 2010.

Prime Minister Manmohan Singh and Mexican President Felipe Calderon Hinojosa, here on a four-day visit, tackled a broad spectrum of bilateral and global issues as the two countries took a fresh look at lucrative opportunities offered by their growing economies.

After the talks, the two sides inked three pacts in the presence of their two leaders.

With the extradition treaty, the two sides signed an accord on rendering mutual legal assistance in criminal cases that will also bring terrorism in its ambit. External Affairs Minister Pranab Mukherjee and his Mexican counterpart Patricia Espinosa Cantellano inked the accords.

The third agreement was on avoidance of double taxation, which is expected to spur the ongoing Indian investment and joint ventures in Mexico and encourage the entry of Mexican companies into the Indian market. Finance Minister P. Chidambaram and Cantellano signed the document.

Bilateral trade has been growing swiftly. Trade between India and Mexico has reached $1.8 billion, of which $1.1 billion consisted of India’s exports and $0.7 billion imports.

India and Mexico are set to double their trade in the next three years, said Calderon while addressing apex chambers of commerce and industry in India. Mexico can offer to the Indian companies, preferential access to one billion customers through the trade agreements with 44 countries including the US, he said.

India’s growing reputation as a knowledge power and one of Asia’s fastest growing economies has whetted the enthusiasm of over 100 Mexican businessmen who are accompanying the Mexican president on his visit to India.

Indian businessmen are not new to Mexico: two steel plants of NRI businessman Lakshmi Mittal, Videocon’s acquisition of a Mexican TV manufacturing plant and pharma giant Dr. Reddy’s Laboratories’ are big names in Mexico.

Mexico set a high premium on Indian investment. Three months ago, Calderon himself inaugurated a ‘global tech development center’ set up by Tata Consultancy Services in Guadalajara.

Indian entrepreneurs have woken up to the manifold attractions of Mexico. Its proximity to the rich US-Canada market and its membership of the North Atlantic Free Trade Treaty (NAFTA) makes it an ideal hub for Indian industries.

Mexico, the cradle of ancient Maya and Aztec civilisations, has been quick in response. After years of dilly-dallying, it has liberalised its visa regime for Indian businesspersons.

The Aditya Birla Group is eyeing Mexico as a base to produce tyres for the US market. Ranbaxy, Reliance, ONGC Videsh and Wipro are all looking at Mexico afresh.

It’s not just business that is bonding the two nations together. Strategic calculations and a sense of shared interests in global area promises to push them closer.

It was the Mexican president who floated the idea of a G-5 grouping of nations comprising China, South Africa, Brazil, India and Mexico, outreach nations to the G8 at the last summit of the world’s wealthiest nations. The proposed grouping, when it turns real, could open another important window of cooperation between India and Mexico.