Why is Uruguay India’s secret weapon to conquer South American markets?

As India continues to expand its global footprint, South America is emerging as a critical region for strategic and economic partnerships. Among the nations of this continent, Uruguay is fast becoming the focal point for India’s engagement with South America.

With its strong democratic values, favourable business environment and strategic location, Uruguay presents a compelling case for Indian companies to use as a gateway to the region. The upcoming visit by Jaideep Mazumdar, Secretary (East) of the Ministry of External Affairs, underlines the importance of this bilateral relationship, as does the recent invitation by Uruguay’s Ambassador to India, Alberto Guani, for Indian companies to set up a base in Uruguay.

Why Uruguay?

Uruguay stands out in South America as a beacon of stability and economic opportunity. According to the ambassador, the country has one of the strongest democracies in the region, with a well-established judicial system and a transparent governance framework that promotes business growth. Ambassador Guani’s emphasis on Uruguay’s democratic values ​​and strong institutions highlights the critical role these factors play in creating an enabling environment for economic productivity. Free elections, independent judicial systems, and a commitment to equality before the law make Uruguay an attractive destination for Indian companies looking to expand their operations in South America.

Moreover, according to him, Uruguay’s strategic location offers Indian companies access to the broader South American market. As the only South American country to participate as a partner in the Vibrant Gujarat Summit earlier this year, Uruguay has demonstrated its commitment to strengthening economic ties with India. The country’s participation in the International Solar Alliance and ongoing negotiations for a new Bilateral Investment Treaty with India further underscore its potential as a key partner in India’s South American strategy.

Indian companies setting up base in Uruguay

The growing presence of Indian companies in Uruguay is a testament to the country’s attractiveness as a business hub. Tata Consultancy Services (TCS), one of India’s leading IT companies, established its first South American operations in Uruguay over two decades ago. Since then, TCS has expanded its presence in the country, collaborating with local firms such as Carlos Ott Architects and Carlos Ponce de León Architects to develop iconic projects such as the Tata Consultancy Campus in Montevideo. This development of the cyber corridor not only showcases Uruguay’s architectural grandeur but also symbolises the strengthening of economic ties between both nations.

In 2022, another Indian IT company, Infogain, started operations in Uruguay, further cementing the country’s status as a preferred destination for Indian companies. Infogain’s entry into the Uruguayan market highlights the potential for Indian companies to use Uruguay as a base to expand their operations across South America.

The Uruguayan government’s plan to establish honorary consulates in Indian cities such as Chandigarh and Bengaluru reflects the growing importance of relations between India and Uruguay and the mutual interest in fostering closer economic ties.

The way forward

The upcoming political consultations between India and Uruguay, along with the much anticipated visit of Secretary Jaideep Mazumdar, are expected to pave the way for stronger bilateral relations. As Uruguay moves closer to joining the International Solar Alliance, new opportunities for collaboration in renewable energy are likely to emerge, offering Indian companies more incentives to invest in the country. The ongoing negotiations for a new Bilateral Investment Treaty also promise to improve the business environment for Indian companies operating in Uruguay.

Uruguay’s appeal lies not only in its economic stability and strategic location, but also in its commitment to democratic values ​​and social equality. As Ambassador Guani noted, Uruguay’s ethos of “no one is more than anyone else” resonates with India’s own democratic principles. This shared commitment to equality and social justice provides a strong foundation for a deep and lasting partnership between the two countries.

With business-friendly conditions, a stable democratic framework and a strategic location, Uruguay is well positioned to become India’s key partner in South America.

Note: This is an article republished from the «Financial Express» media outlet through a cooperation agreement between both parties for the dissemination of journalistic content. Original link.