Argentine President Javier Milei said he would leave Mercosur if necessary to cement a free trade agreement with the US, although he hopes to reach a deal without needing to take such drastic action.

In the mid-1970s, an association in Kerala made this unorthodox proposal to the Indian government, reviving an idea whose roots go back further.

The EU said on Tuesday it plans to set up a one billion euro ($1 billion) "reserve" for European farmers that might be negatively impacted by a trade deal with Latin America's Mercosur.

The Mercosur, Mercado Común del Sur (Common Market of the South) is an ambitious economic integration project which includes the founding members Argentina, Brazil, Paraguay and Uruguay.