MERCOSUR group
Why in news?
- India and Brazil have initiated talks to expand and deepen the existing trade pact between India and the MERCOSUR group.
- The aim is to transform the current Preferential Trade Agreement (PTA) with limited coverage (only 450 tariff lines) into a more comprehensive trade agreement that covers a broader range of products and services.
- The MERCOSUR Group, also known as the Southern Common Market (Mercado Común del Sur in Spanish, Mercosul in Portuguese),
- It is a South American regional economic and political organization established by the Treaty of Asunción in 1991 and the Protocol of Ouro Preto in 1994.
- It aims to facilitate free movement of goods, services, capital, and people among its member countries to create an integrated regional market and promote economic development.
- Headquarters is located in Montevideo, Uruguay.
- Official working languages are Spanish and Portuguese.
- The group has a combined population of over 285 million and a GDP nearing $3 trillion.
- Full members: Argentina, Bolivia, Brazil, Paraguay, and Uruguay.
- Venezuela is a full member but has been suspended since December 1, 2016.
- Associate members include Chile, Colombia, Ecuador, Guyana, Panama, Peru, and Suriname.
- The organization facilitates free trade and a customs union with a common external tariff on imports from non-member countries.
- MERCOSUR aims to become a common market similar to the European Union, enabling more integration of member economies.
- The bloc has faced challenges such as political disagreements, uneven economic development, and reduced intra-bloc trade at times.
- It has worked on trade agreements outside the bloc, including recently clinching a trade deal with the European Union in late 2024 after long negotiations.
- Other negotiations with the US and China remain ongoing as of 2025.
- The bloc aims to protect regional industries but has also expanded trade opportunities within the region and beyond.
