Lula calls for trade revolution

Indian and Brazilian leaders are keen to strengthen links

Brazilian President Luiz Inacio Lula da Silva has called on India to join forces with his country to challenge the current geography of world trade.

Speaking on an official visit to Delhi, President Lula said there were many similarities between India and Brazil.

He said the two countries could change global trading patterns if they acted together in negotiations.

He later witnessed the signing of a preferential trade pact between India and South America's Mercosur bloc.

The Brazilian president told reporters after a ceremonial welcome at the presidential palace in Delhi: "I believe that India and Brazil together can build a strong political force that is capable of making a contribution, so that the trade geography of the world can change for the better."

He said such an alliance would "meet the needs of the poorest people of the planet".

As an initial step, a preferential customs duty accord between India and the Mercosur nations of Brazil, Argentina, Uruguay and Paraguay was signed in the presence of Lula and Indian Prime Minister Atal Behari Vajpayee.

Indian officials described it as a framework agreement setting out the parameters for free trade between the five countries, with further details still to be finalised.

Growing trade

The BBC's Steve Kingstone in Sao Paulo says the aim of Lula's four-day visit to India, which began on Sunday, is to cement the already strong ties between two of the world's largest developing countries.

He says that with a combined population of more than 1.2 billion people, India and Brazil both have ambitions to take a leading role on the world stage, and the two governments face similar problems alleviating hunger and reducing poverty.

Economic relations between Brazil and India have been growing steadily, with commerce increasing four-fold over the past four years.

The value of bilateral trade reached a record $1.2bn in 2002.

Last September, Brazil and India led a group of developing nations that clashed with the United States and the European Union at the Cancun summit in Mexico.

The group wants to see a reduction in farm subsidies around the world.

Brazil has welcomed suggestions from Washington that the US is now ready to discuss the issue.