India & Paraguay: Revitalising A South-South Axis

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The deepening engagement is not merely transactional; it is deeply interwoven with India's long-standing commitment to leading the Global South
The visit of Paraguayan President Santiago Pena to India is a pivotal moment, with Prime Minister Narendra Modi describing it as 'historic". The visit firmly underlines Paraguay as a key partner and an important member in India's Latin American outreach. It is also a crucial element in India's broader strategy to revitalise its South-South cooperation and reinforce its burgeoning leadership role within the Global South.
President Santiago Pena's visit to India marks only the second time a Paraguayan President has visited India and the first-such visit in recent decades. The visit is built upon a foundation of trust, with India's support to Paraguay during the Covid-19 pandemic through vaccine supplies.
Discussions between the two leaders covered a wide array of sectors, including agriculture, pharmaceuticals, technology, renewable energy, health, critical minerals, railways, and people-to-people contacts. Both leaders want to enhance trade linkages and explore new investment opportunities. PM Modi emphasised that these talks would introduce 'new dimensions" to India-Latin America relations.
President Pena's itinerary includes a visit to Mumbai, where he will engage with the state political leadership, business and industry representatives, startups, and tech leaders, and is aimed at broadening bilateral engagement.
The focused engagement with Paraguay is indicative of India's wider, strategic pivot towards Latin America. The region is vital for India's economic diversification, particularly as the 'trade weaponisation' era commences. Latin America has already become one of India's most important export markets for automobiles, accounting for nearly half of its motorcycle exports and a quarter of its car exports in 2024. Notably, India now exports more cars to Chile than to the United States, with Peru being the next significant market. It marks a shift in India's global export strategy.
Resource security is another critical driver. Latin America supplies approximately 15-20 per cent of India's petroleum imports and provides significant quantities of vegetable oils and agricultural products. Beyond this, the region holds abundant reserves of critical minerals—copper, lithium, nickel, cobalt, and rare earths—essential for India's energy transition.
Major agreements are in place: Chile's Codelco, the world's largest copper producer, has committed to selling copper concentrates to Kutch Copper, following Chilean President Gabriel Boric's visit to India in April 2025, which also announced a Comprehensive Economic Partnership Agreement (CEPA).
Similarly, Brazil's Petrobras is set to supply six million barrels of oil annually to Bharat Petroleum, with plans to increase this to 24 million barrels per year, signifying a crucial diversification of Petrobras's customer base away from its heavy concentration on China. Argentina's state-owned oil company, YPF, has also signed a deal with Indian firms to export up to 10 million tons of liquefied natural gas (LNG) annually, alongside cooperation on lithium and other critical minerals.
This deepening engagement is also opening up the Latin American market for Indian companies. Indian automobile and pharmaceutical firms are establishing manufacturing units in Latin America to leverage lower tariffs for exports to the US, capitalising on the US's existing Free Trade Agreements (FTAs) with 11 Latin American countries. Tata Consultancy Services already employs 2,000 people in Peru and Chile. It is a significant evolution in the India-Latin America relationship.
Leadership in the Global South: A Core Tenet
India's outreach to Latin America is linked to its deep-seated commitment to South-South cooperation. India boasts a long and distinguished history of advocating for developing nations, including co-sponsoring the 1955 Bandung Conference and playing a pivotal role in the founding of the 1961 Non-Aligned Movement (NAM), which now comprises 120 nations. It was also an inaugural member of the Group of 77 (G-77) in 1964, a key intergovernmental organisation dedicated to fostering South-South collaboration for development.
In contemporary global forums, India continues to champion the cause of the Global South. At the 19th G20 Summit in Rio de Janeiro, PM Modi passionately underscored the challenges faced by these nations, including critical issues such as food, fuel, and fertiliser crises exacerbated by global conflicts. India's leadership played a crucial role in securing permanent G20 membership for the African Union, an initiative that originated during India's own 'Voice of the Global South Summit' in January 2023.
India has subsequently hosted multiple such summits, including the third virtual iteration in August 2024, involving dignitaries from 123 countries, embodying the ethos of 'Sabka Saath, Sabka Vikas, Sabka Vishwas, and Sabka Prayas'.
President Santiago Pena's historic visit to India serves as a powerful symbol of India's re-energised South-South axis. It concretely demonstrates India's deliberate and strategic shift towards Latin America, a region critical for its economic diversification and resource security. This deepening engagement is not merely transactional; it is deeply interwoven with India's long-standing commitment to leading the Global South, fostering trust, and offering an alternative model of cooperation based on shared aspirations rather than conditionalities.
By blending robust economic diplomacy with its principled stance on international collaboration, India is not only securing its future but also actively shaping a more balanced and equitable global order, embodying its pursuit of true 'strategic autonomy."
About the Author
Sohil Sinha
Sohil Sinha is a Sub Editor at News18. He writes on foreign affairs, geopolitics along with domestic policy and infrastructure projects.
First Published:
June 03, 2025, 10:33 IST
News explainers India & Paraguay: Revitalising A South-South Axis