Manmohan Singh at the meeting in Brasilia. (AP)

Brasilia, Sept. 13: India is exploring a possible trade arrangement that would link it with Mercosur, the principal trading bloc in South America, and the Southern African Customs Union.

Prime Minister Manmohan Singh said this today while addressing a meeting with President Luiz Inacio Lula da Silva of Brazil, President Thabo Mbeki of South Africa and the chief executive officers of companies from the three countries.

The Prime Minister thus indicated a new direction that India wanted to take to expand economic and other relations to untried areas. Singh goes to South Africa later this month for another bilateral meeting.

Apart from Brazil’s economic strength, it has also acquired a new global status in view of its position as chairman of the Nuclear Suppliers Group and because of its role in the proposed reforms of the UN and the expansion of the UN Security Council.

To start with, the three countries propose to establish an IBSA (India-Brazil-South Africa forum) mechanism for exchange of information and experiences on regulatory issues and for organising sector-specific workshops and seminars on technical regulations. They would also look at the possibility of harmonising standards.

India expects such an arrangement to create a large and expanding economic space that would link trade and technologies from the three continents of Asia, Africa and South America.

Singh expressed satisfaction at the progress of the IBSA forum that was launched three years ago. He, however, suggested that IBSA expand beyond the confines of the three governments. He expected the business communities in the three countries to contribute to IBSA’s success.

He pointed out specific areas of strength of each of the three countries — Brazil, a world leader in the use of ethanol; South Africa has coal gassification technology, and India has expertise in wind and solar energy.

IBSA, he said, could be effective in utilising these countries’ competitive strength in these alternative energy technologies.

He would like the IBSA to meet the trilateral trade target of $10 billion that was set in the New Delhi plan of action, adopted in March 2004.