India- MERCOSUR PTA has come into effect from 1st June, 2009. India with a total trade of US $ 4773.39 million with MERCOSUR during 2007-08, had exports of about US $ 2904.8 million during 2007-08 while imports stood at about US $ 1868.39 million during the same period.

The major product groups covered in the offer are food preparations, organic chemicals, pharmaceuticals, essential oils, plastics & articles thereof, rubber and rubber products, tools and implements, machinery items, electrical machinery and equipments. The break-up of the number of tariff lines for different MOPs is: - 393 tariff lines - 10%, 45 tariff lines - 20% and 14 tariff lines - 100%.

The major sectors covered in offer list of India are meat and meat products, inorganic chemicals, organic chemicals, dyes & pigments, raw hides and skins, leather articles, wool, cotton yarn, glass and glassware, articles of iron and steel, machinery items, electrical machinery & equipments, optical, photographic & cinematographic apparatus. The break-up of the number of tariff lines for different margin of preferences (MOP) is:- 93 tariff lines - 10%, 336 tariff lines - 20% and 21 tariff lines - 100%.

MERCOSUR is a trading bloc in South America region comprising of Argentina, Brazil, Paraguay and Uruguay. It was formed in 1991 with the objective of free movement of goods, services, capital and people and became a customs union in January 1995. MERCOSUR's role model is European Union.

A Framework Agreement had been signed between India and MERCOSUR on 17th June 2003 at Asuncion, Paraguay. The aim of this Framework Agreement was to create conditions and mechanisms for negotiations in the first stage, by granting reciprocal tariff preferences and in the second stage, to negotiate a free trade area between the two parties .

As a follow up to the said Framework Agreement, a Preferential Trade Agreement (PTA) between India and MERCOSUR was signed in New Delhi on January 25, 2004 and five annexes to this Agreement were signed incorporated on March 19, 2005. By this PTA, India and MERCOSUR have agreed to give tariff concessions, ranging from 10% to 100% to the other side on 450 and 452 tariff lines respectively. Preferential Trade Agreement grants reciprocal tariff concessions between India and Mercosur across multiple industrial and agricultural product lines. The Preferential Trade Agreement between India and MERCOSUR, effective 1 June 2009, implements reciprocal tariff concessions negotiated under a 2003 Framework and the 2004 PTA with 2005 annexes. Concessions range from ten percent to full elimination across designated tariff lines, covering sectors such as chemicals, pharmaceuticals, machinery, electrical equipment, food and meat products, textiles, leather, plastics and rubber; the PTA uses listed margins of preference to operationalise staged market access commitments.