Indian SMEs can explore the markets of Paraguay which have lots to offer, says the Ambassador of Paraguay, Genaro Vicente Pappalardo in an exclusive interview to SME Times.

Paraguay has given a big platform to India for exploring newer markets after the signing of Preferential Trade Agreement (PTA) on June 1. What kind of opportunities are you looking for in the Indian market?
Genaro Vicente Pappalardo: Yes, it is an opportunity for Paraguay to explore the Indian market. Paraguay needs to reiterate and try to catch some cluster. In the PTA we have specific provision where Paraguay can exports 30, 000 tons of soyabeans to India. They are the only country in the MERCOSUR bloc and the fourth in the world exports of soyabeans. So, we are looking forward for better opportunities in the Indian market.

How much boost in exports do you expect from the PTA signed recently between Paraguay and India?
Genaro Vicente Pappalardo: Paraguay is the largest exporter following Argentina, United States, and also India. In the PTA, there are already 900 items which gradually will increase. We will list many other products as well. For us exporting 30,000 tons of soyabeans in a year is very good move. We can increase our capacity to India. In my three years of working as an ambassador in India, I have approached lots of private sectors, rural areas & agricultural area. I have organized meetings in Punjab as people are very interested in investing in the new markets of Paraguay.

India is reeling under the pressure of global meltdown and exports from India are being hampered. Do you feel the country can provide you with any opportunity at this moment?
Genaro Vicente Pappalardo: For me this is the right moment. I know that it is a turbulent moment and difficult year but I am very positive. I am optimistic that this moment of global turmoil, Paraguay-India can do a lot of trade.

Why did you choose India as a destination to increase your volume of trade?
Genaro Vicente Pappalardo: We are managing our relationship with foreign countries. India has markets where we can reach out for business. I am sure that India will grow more in future and we can grow with India. Our corporations in Paraguay have shown interests in India. I am sure that in two years we will be in a very good position. I think it is good to share and follow up. We are very closely working with India and expect to increase our trade in future.

Can we expect a FTA with the Mercosur countries?
Genaro Vicente Pappalardo: Yes, of course. We can expect FTA, I think PTA is the first step. We have to grow. We have to make a start. In this kind of PTA, we have a lot of expectations but the reality is something different. With India we can expect a FTA in future.

The PTA offers the possibility of further expanding the list of products covered by the agreement. To this effect, the PTA provides the legal framework to continue negotiations towards the creation of a Free Trade Area.

Could you highlight which are the items that the PTA contemplates lowering tariffs?
Genaro Vicente Pappalardo: We have soyabeans, leather, textile & clothing, 200 dry coconuts to offer to India. In fact, 100 tons of cumin seeds per year. We are more into agriculture.

Are you planning for any joint venture with Indian companies?
Genaro Vicente Pappalardo: I have lots of planning for joint ventures. We can't mention the name of the companies because it is in the process of discussion. We are planning some joint ventures for producing soyabeans in Paraguay. One project is for food processing in Paraguay. I have another project to assemble machinery like tractors, if India is interested. Some companies are interested in joint ventures in call centers. Some projects are functioning under the government of India. However, we have lots of planning for joint ventures.

What is the current trade transaction between India and Paraguay?
Genaro Vicente Pappalardo: Actually, we import more than we export to India. According to my personal opinion, after the signing of the PTA the bilateral trade could be increased. According to my assumption, if we import US$40 million then we export US$20 million to India. I do not have the exact figures.

Is there direct flight connectivity from India to Paraguay and vice versa?

What is the expected trade transaction between India and Paraguay in another five years?
Genaro Vicente Pappalardo: The trade between India and MERCOSUR could be US$10 billion. I do not have the projection of figures and volume of trade between India- Paraguay. But probably I think the trade could be more than 30 percent.

In your opinion how can the Small and Medium Entrepreneurs (SMEs) from both the sides come together and increase economic cooperation?
Genaro Vicente Pappalardo: This is a good question. We have four largest family companies in the pharmaceutical sector in Paraguay.

India has a huge production of its own. Indian small and medium size companies can do business with Paraguay. Sectors such as textiles is very good and even gems & jewelry provide good opportunity. We can also direct the Indian companies to purchase cotton from Paraguay. We have leather in this PTA which includes leather bags. In fact, I am planning to bring some companies to India as well.

Do you provide any type of tax benefits to the Indian entrepreneur?
Genaro Vicente Pappalardo: Yes, we provide a lot of incentives. Starting from USD 5 million minimum. For getting tax benefit you have to knock the Ministry of Commerce and Industry in India. I think for five years there is no requirement for paying any tax which is applicable to different sectors.