Prime Minister Narendra Modi has congratulated the newly elected President of Brazil Luiz Inacio Lula da Silva on his re-election. This has again drawn attention to the bilateral relations between the two countries. These relations were once limited to limited trade, but have now evolved into extensive economic and diplomatic partnerships. Both countries want a strong voice on the global stage for developing economies. In a post on ‘X’ (Twitter), Modi called Lula his “dear friend” and said he was keen to deepen the India-Brazil strategic partnership. He said the two countries will strengthen cooperation in various fields, advance the shared priorities of the ‘Global South’ (developing countries) and work towards building a more inclusive, equitable and sustainable world.

Brazil is India’s largest trading partner in Latin America and the Caribbean region. Both countries work together on global issues such as United Nations (UN) reform, climate change and counter-terrorism. During Lula’s presidency, Indo-Brazilian relations made significant progress. These ties gained momentum during his first two terms in office from 2003 to 2010 and further expanded after he returned to power in 2023. The common goal of both countries is to make the voice of major developing economies more effective in international organizations and negotiations.

business goals

Economic relations between the two countries have grown significantly since Lula’s first presidential term. According to India’s Ministry of External Affairs, bilateral trade is expected to reach $15.21 billion in 2025, up 25% from $12.2 billion in 2024. Total trade in the first half of 2026 stood at $8.77 billion, up nearly 37% from the same period last year.

In 2025, India exported $8.35 billion worth of goods to Brazil, including petroleum products, chemicals, medicines and engineering products. At the same time, India imported $6.85 billion worth of goods from Brazil, including crude oil, soybean oil, raw sugar, cotton and iron ore.

During his visit to India this year, Lula aimed to increase bilateral trade to $30 billion. He said that the economic potential of both the countries is very strong. This is more ambitious than the $20 billion target set by Modi earlier for 2030.

Lula also described India as the “democratic brother of the Global South”. Speaking at the ‘India-Brazil Economic Forum’ in New Delhi, he emphasized that the relationship is based on equality and mutual respect.

He said that the most important thing is that when we are negotiating with a country like India, we are not dealing with a settler. He described this relationship as different from the dialogue with rich countries.

Strategic partnership

The foundations of the current relationship were laid during Lula’s first two terms in office. His visit to India as the chief guest at the Republic Day celebrations in January 2004 gave a new high to the bilateral relations between the two countries. In 2006, during the then Prime Minister Manmohan Singh’s visit to Brazil, India and Brazil formally elevated their relationship to the status of ‘Strategic Partnership’.

The two countries agreed to deepen trade ties and enhance cooperation in the areas of technology, energy security and international security. He also sought to expand investment and trade relations, taking the scope of these relations beyond mere trade.

Lula also mentions how his alliance with India influenced Brazil’s economic thinking. Recalling his visit to India in the mid-2000s, he said that after seeing India’s foreign exchange reserves, he realized how important it was to maintain foreign exchange reserves. At that time India’s foreign exchange reserves were around $100 billion.

It was in India in 2005 that I first realized the importance of international ‘hard currency’ reserves. He said that after this Brazil increased its foreign exchange reserves to about 360 billion dollars. He described the move as very important for the economic strength of the country and its position in international financial institutions.

A Common Voice for the Global South

India and Brazil used their growing relationship to coordinate on issues affecting developing economies. In 2003, he initiated the ‘India-Brazil-South Africa Dialogue Forum’ (IBSA) with South Africa. It provided a platform for these three countries to work together on development and international affairs.

The first summit-level meeting of the group was held in Brazil in 2006. Its agenda includes cooperation in the fields of agriculture, energy, health, education, science and technology. These three countries tried to translate their shared concerns into a stronger voice in global institutions. India and Brazil also coordinated with Russia and China through the ‘BRIC’ grouping. The first summit of the group was held in 2009 and the second summit was held in April 2010 in Brazil.

BRICS Diplomacy

Lula’s re-election could give new impetus to India-Brazil cooperation in BRICS, especially in terms of reforming global institutions like the United Nations Security Council. Both countries want the role of developing economies to be strengthened in the international decision-making process. At the same time, India is pushing for a permanent seat on the Security Council.

Lula has also advocated conducting bilateral trade in local currencies instead of relying solely on the US dollar. During his visit to India in February 2026, he said that the two countries could consider using the Indian rupee and the Brazilian real for trade payments, though he acknowledged challenges to this. It is not necessary that the trade agreement between India and Brazil should be denominated in US dollars. We can use our currency. It’s hard, but we can try.