From historical solidarity to strategic trade: The India–South Africa opportunity
India and the Southern African Customs Union (SACU) signed Terms of Reference in New Delhi on 12 August 2026 to formally begin negotiations on a Preferential Trade Agreement (PTA), reviving talks that had stalled without conclusion after five rounds held between 2002 and 2010.
The renewed push was accelerated on the sidelines of the BRICS Trade Ministers' Meeting hosted in Jaipur as part of India's 2026 BRICS chairship.
The proposed PTA is expected to initially focus on trade in goods, with both sides aiming to conclude negotiations within roughly a year.
Discussions between the two sides also covered expanding cooperation in critical minerals, pharmaceuticals, and manufacturing, alongside the trade-pact talks.
Southern African Customs Union (SACU) and Preferential Trade Agreements
SACU is the world's oldest customs union, comprising South Africa, Botswana, Namibia, Lesotho, and Eswatini, operating a common external tariff and a shared customs revenue pool among its members. A Preferential Trade Agreement (PTA) is a category of trade arrangement offering reduced (not necessarily zero) tariffs on a limited, negotiated list of goods between parties — distinct from a Free Trade Agreement (FTA), which eliminates tariffs on substantially all trade, and a Comprehensive Economic Cooperation/Partnership Agreement (CECA/CEPA), which extends further into services, investment, and regulatory cooperation.
Key Details
- SACU's origins trace to a 1910 customs union agreement among its constituent territories, making it the oldest functioning customs union in the world; the current SACU Agreement dates to 2002.
- India-SACU PTA talks were first launched in 2002 and held five negotiating rounds through 2010 without a concluded agreement, before being revived via the August 2026 Terms of Reference.
- India already has PTAs and FTAs of varying depth with other African-linked or developing-economy blocs (e.g., MERCOSUR PTA, 2009), reflecting a graduated approach to market access agreements based on the negotiating partner's readiness.
The 2026 revival positions the India-SACU PTA as India's first trade agreement with a regional bloc on the African continent, filling a long-standing gap in India's Africa trade architecture.
BRICS and India's 2026 Chairship
BRICS (originally Brazil, Russia, India, China, South Africa) is an intergovernmental grouping of major emerging economies formed to enhance economic cooperation and reform global financial governance; it expanded in January 2024 to admit Egypt, Ethiopia, Iran, and the UAE (with Saudi Arabia invited but not formally joining), and Indonesia joined as a full member from January 2025. India holds the rotating BRICS chairship in 2026, hosting ministerial meetings including the Trade Ministers' Meeting in Jaipur.
India's chairship year gave it a natural platform — the Jaipur Trade Ministers' Meeting — to convene South Africa's trade minister and accelerate a bilateral/bloc-level negotiation that had been dormant for over a decade.
India-Africa Trade Relations
India's economic engagement with Africa has historically been anchored in development finance (Lines of Credit via EXIM Bank), the India-Africa Forum Summit process (first held 2008), and duty concessions such as the Duty-Free Tariff Preference (DFTP) Scheme (2008) for Least Developed Countries, many of which are African.
Key Details
- India is one of Africa's top trading partners, with bilateral trade dominated by energy imports (crude oil) and India's exports of refined petroleum, pharmaceuticals, and machinery.
- Critical minerals cooperation (highlighted in the SACU talks) aligns with India's National Critical Mineral Mission and the broader push to secure supply chains for battery and clean-energy inputs, many of which are concentrated in African geologies (e.g., cobalt, manganese).
- A concluded India-SACU PTA would be distinct from, and could complement, India's existing engagement with the African Continental Free Trade Area (AfCFTA, operational since 2021), which SACU members are also part of.
The PTA talks reflect a shift from India's traditional aid/credit-based Africa engagement toward a formal, reciprocal market-access framework, timed to India's heightened multilateral visibility as BRICS chair.
- SACU members: South Africa, Botswana, Namibia, Lesotho, Eswatini (five members).
- India-SACU Terms of Reference for PTA talks signed on 12 August 2026 in New Delhi; original talks date to 2002-2010 (five rounds, no conclusion).
- BRICS expanded in January 2024 (Egypt, Ethiopia, Iran, UAE) and January 2025 (Indonesia); India holds the 2026 chairship.
- The New Development Bank was established in 2014 and is headquartered in Shanghai.