With President Lula's visit, India-Brazil trade ties touch new heights

Brazil Prez concluded his India visit after signing an array of agreements

Brazilian President Luiz Inacio Lula da Silva during the weekend told Prime Minister Narendra Modi that their countries should set a bilateral trade target more ambitious than the $20 billion the two had agreed upon at their meeting in Brasilia in July last year. This is to be achieved in five years. 

The two sides inked 10 agreements, including strengthening cooperation in supply chains relating to steel production, mining, and critical minerals, and another seven in the private sector, with three in pharmaceuticals. 

According to Indian officials, Lula told Modi that a $20 billion trade target “doesn’t seem ambitious enough” and they should try to achieve $30 billion by 2030. Brazil is India’s largest trading partner in Latin America. Bilateral trade in 2025 was $15.21 billion, registering an increase of 25.5 per cent over 2024. India has a trade surplus of about $1.5 billion with Brazil. “I have brought 11 ministers and 300 businessmen with me,” Lula told Modi. 

The two leaders discussed Washington’s trade policy and the implications of the United States (US) Supreme Court judgment on President Donald Trump’s tariffs, and agreed that both sides needed to study the implications of this and wait for further developments by the US administration, said P Kumaran, secretary (east), Ministry of External Affairs.  He also said Modi and Lula did not discuss a BRICS common currency. 

Lula and Modi have been in touch ever since the White House last year slapped 50 per cent tariffs on their exports to the US. The Brazilian leader is scheduled to meet Trump in March in Washington. 

Lula, who concluded his India visit on Sunday morning, said at a press meet that his agenda at the Washington meeting would include trade, immigration, investment, and partnership between universities. Lula declined to comment on the US Supreme Court decision. At their joint press conference, Modi spoke about the importance of the India-Brazil partnership on the global stage. “As democratic countries, we will continue to advance the priorities and aspirations of the Global South,” he said. 

Lula said the “turbulent global environment” required India and Brazil to deepen their strategic ties. “We are not just the two biggest democracies of the Global South. This is a meeting of a digital superpower with a renewable energy superpower. We are both mega diverse countries and we both defend multilateralism and peace,” he said. 

He also emphasised the need to reform the United Nations Security Council to represent the interests of the Global South. “Brazil and India are natural candidates to become permanent members,” he said. According to the joint statement issued on Saturday, the two leaders directed their respective sides to work to eliminate non-tariff barriers. 

Major deals signed 

Lula gave Modi a detailed presentation on Brazil’s substantial critical minerals and rare earth reserves. He said only 30 per cent of Brazil’s reserves have been explored, and that there is substantial scope for exploration, processing minerals, and also using them. 

The two sides signed deals to increase cooperation in areas of rare earth and critical minerals, another on MSME entrepreneurship and crafts, and agreed on an action plan on digital partnership. Pacts were signed between India’s Central Drugs Standard Control Organisation and Brazilian National Health Regulatory Agency, for mining for the steel supply chain sector and one on electronic certificates of origin.  Brazil is among the world’s top producers of iron ore. 

They also discussed ways to strengthen and diversify trade, including through expansion of the India-Mercosur (Southern Common Market) Preferential Trade Agreement (PTA), which currently covers only 450 tariff lines.  Officials said the negotiations are in “early days”, with discussions centring around which areas that could be opened up. But all Mercosur members are committed to find ways to enhance trade “because all are very keen on diversification of trade partnerships and also to enhance resilience in our supply chains,” the official said. 

The two sides highlighted the opportunities for greater collaboration between Indian and Brazilian companies in the aviation and defence sectors, and encouraged their respective private sectors to strengthen collaboration. A trilateral understanding between Mazagaon Dock Ltd and Indian and Brazilian navies was also signed for the maintenance of Scorpene Class submarines and other military ships. India is also keen on launching Brazilian satellites. 

A pact was signed between their drug regulatory agencies to foster more expeditious approvals for reciprocal imports, with the objective of facilitating equitable access to affordable quality medicines. The two sides are also talking about enhancing market access for agricultural products. 

Agreements in the private sector included those Brazilian companies and India’s Biocon Pharma and Lupin. The Brazilian Exports and Investment Promotion Agency (ApexBrasil) and the Federation of Indian Chambers of Commerce and Industry (FICCI) signed a pact to promote trade and investment. The Brazil Sugarcane Industry Association and Indian Sugar and Bio-energy Manufacturers Association signed an ethanol production deal. 

Other private sector agreements included Adani Defence and Aerospace and Brazilian major Embraer’s plan to set up a final assembly line in India for the E175 regional jets. Modi also asked Embraer to set up an MRO (Maintenance, Repair, and Overhaul) facility.  Another MoU was signed between NMDC Ltd, Vale SA, and Adani Gangavaram Port Ltd to increase cooperation in creating a facility under a Special Economic Zone (SEZ) regime at Gangavaram port, to blend and sell iron ore fines. 

Brazil also extended business visa for Indian ordinary passport holders to 10 years.