Iran and India proposes to sign preferential trade agreement

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-

  1. It will reduce the tariffs on a number of goods that are traded between India and Pakistan.
  2. Bilateral investment protection and double taxation avoidance agreements are also hoped to be finalised.
  3. 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.
  4. Over the last couple of years, export from India to Iran has increased albeit at a slower pace.
  5. Iran and India look forward to making a rupee trade agreement for petroleum and other purchases that can make the Indian currency stronger.
  6. 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.