In an EPA, two trading partners substantially reduce or eliminate import duties on certain products traded between them. The two countries have resumed talks for a second extension of the trade agreement, the official said. Under the expanded EPZ, Chile offered India concessions on 1,798 customs positions (products) with a preferential margin (MoP) of 30 to 100 per cent. This means that, after the implementation of the expanded EPZ, Chile will apply lower tariffs on 1,798 products imported from India than it imposes on its other trading partners in normal trade. Tariffs are reduced by 30-100% (preferential margin) depending on the post office. The aim of this framework agreement is to strengthen relations between the parties, promote the expansion of trade and create the conditions and mechanisms for negotiating a free trade agreement in accordance with WTO rules and disciplines and in accordance with Article 4 of the framework agreement. “Bilateral trade between India and Chile has enormous potential to expand, as it is currently at a low level, mainly due to the distance between countries. Both governments hope that once existing EPZs are expanded, exporters from both countries will have a greater incentive to explore markets,” the official said. Opportunities to increase investment between the two countries were also discussed. After four rounds of negotiations, Chile and India concluded a preferential trade agreement on 23 November 2005. The Chile-India preferential trade agreement was signed on 08 March 2006.

In January 2010, the two countries agreed to deepen the PTA with a view to a much broader agreement. A second meeting on deepening the agreement was held in New Delhi on 5 and 6 August 2010. The third meeting took place on 5 July 2011 in Santiago. The fourth meeting took place in New Delhi on 2 and 3 February 2012. Negotiations on deepening the EPZ concluded in New Delhi on 20 October 2014. The Government of India and the Government of the Republic of Chile, driven by the desire to develop and strengthen trade between the two countries and promote closer economic relations, have agreed: the two governments regularly consult and fully consider proposals for the development and expansion of trade, as well as diversification and compensation for trade between the two countries.