The recent visit of Brazilian President Jair Bolsonaro to India on the occasion of the 71st Republic Day not only deepens diplomatic relations, but also presents numerous opportunities for bilateral growth between the two nations. At the India-Brazil Business Forum held during this visit, 15 Memorandums of Understanding (MoUs) were inked, covering diverse fields like trade facilitation, investments, social security, agriculture, defence and double taxation.
MoUs signed and their significance
The MoUs signed during this visit pertain to multiple important sectors such as investments, trade facilitation, social security, agriculture, defence and double taxation. Through these MoUs, both nations aim to further streamline and consolidate their respective processes, and in turn stimulate economic growth and societal development.
Revisiting the India – Brazil Business Leader’s Forum
The visit highlighted an urgent demand for reconstitution of the India- Brazil Business Leader’s Forum. The need of the hour is to ensure that this Forum remains contemporary and relevant to the dynamic business environment and specific needs of both nations.
Trade Target and Economic Relations
India and Brazil have set a trade target of USD 15 billion by 2022. Given that Brazil is a key trading partner of India within the Latin America and Caribbean region, meeting this target is crucial. However, it must be noted that the current bilateral trade between the two nations is worth $8 billion, necessitating earnest efforts to reach the set target.
| Bilateral Trade Value | Trade Target |
|---|---|
| $8 billion | $15 billion |
Tourism and Cultural Cooperation
In a move expected to boost relations in the business and tourism sectors, both countries have declared visa-free travel. Additionally, India’s wellness services like Yoga and Ayurveda are expected to find a larger market in Brazil owing to the strong community of Yoga and Ayurveda practitioners in the nation.
World Trade Organization Dispute
Brazil has challenged the minimum price for sugarcane set by the Indian government at the World Trade Organisation (WTO). While Indian farmers’ groups have asked Brazil to withdraw its complaint, the latter is seeking a “non-litigious solution” without affecting bilateral collaborations on biofuels derived from sugarcane.
Plurilateral Fora and Strategic Partnership
India and Brazil share a relationship that extends beyond the bilateral level to plurilateral fora like BRICS, IBSA, G4, G20, BASIC, International Solar Alliance, Biofuture Platform, and multilateral bodies like the UN, WTO, UNESCO and WIPO. The nations established a strategic partnership in 2006, reinforcing their mutual cooperation and commitment towards growth and development.
Fair Remunerative Prices for Sugarcane
Licence-based sugar factories in India are required to pay farmers a statutory minimum price for sugarcane, termed as Fair and Remunerative Price (FRP). Any purchases made at prices lower than the FRP are considered illegal, thus ensuring a fair deal to farmers and regulating the sugarcane market.