Iran and India have proposed to sign a preferential trade agreement by end 2019 that should bolster the Indian economy.
Let us take a look at the different aspects of the proposed agreement-
- It will reduce the tariffs on a number of goods that are traded between India and Pakistan.
- Bilateral investment protection and double taxation avoidance agreements are also hoped to be finalised.
- Bilateral trade stood at 17B USD in FY- 18-19 and India’s export was only at 3.5 B USD in sectors such as spices, silk etc. Apart from petroleum India imports fertilisers, chemicals from Iran.
- Over the last couple of years, export from India to Iran has increased albeit at a slower pace.
- Iran and India look forward to making a rupee trade agreement for petroleum and other purchases that can make the Indian currency stronger.
- India has clarified that it recognises only international sanctions and not sanctions by just one country to the extent to which all this might affect India Iran trade.