India signed an economic cooperation and free trade agreement with Australia in the presence of PM Narendra Modi and his Australian counterpart Scott Morrison further strengthening India-Australia ties.
As per the agreement, the Australian capital of Canberra would provide duty-free access to 95 per cent of Indian goods such as textiles, leather, sports products and jewellery in its markets.
In a virtual ceremony, the India-Australia Economic Cooperation and Trade Agreement was signed by Commerce and Industry Minister Piyush Goyal and Australian Minister for Trade, Tourism and Investment Dan Tehan.
Union Minister Piyush Goyal said, “We’ve cordial relations with Australia. They’ve raw material while we produce finished goods, both the countries complement each other. Their raw material helps in manufacturing goods in India while they get affordable and quality products from us.”
PM Modi shared a video with the caption, “Strengthening India-Australia economic and trade relations.” on Twitter.
Commenting on the new development under Indo-Australian relations, Prime Minister Modi said,” This is truly a watershed moment for India-Australia relations.”
The Australian PM Scott Morrison added that the pact would further deepen Australia’s close ties with India.
Australia is offering zero duty access to India for about 96.4 per cent of exports (by value) from day one. It covers many products which currently attract 4-5 per cent customs duty in Australia.
Union Minister Piyush Goyal said that the agreement would take the bilateral trade between countries from $27 billion to $45-50 billion in the next five years.
He tweeted, “A historic day for India-Australia ties. We are grateful to our leaders, PM Narendra Modiji and PM Scott Morrison for their constant guidance & motivation. The #IndAusECTA will open a plethora of opportunities in goods & services for both the nations.”
What does the deal mean for India?
About 96.4 per cent of exports (by value) that currently attract 4-5 per cent customs duty will have zero duty access in the Australian Markets.
Labour-intensive sectors such as textiles and apparel, few agricultural and fish products, leather, footwear, jewellery, machinery, electrical goods, furniture, sports goods, and railway wagons would grow.
India-Australia Bilateral Trade:
Australia is India’s 17th largest trading partner, while New Delhi is Canberra’s 9th largest partner.
In 2021, Bilateral trade in goods and services between both countries stood at USD 27.5 billion. India’s goods exports were worth USD 6.9 billion, and imports aggregated to USD 15.1 billion in 2021.
Major exports by India to Australia include petroleum products, textiles and apparel, engineering goods, leather, chemicals, gems, and jewellery, while imports mainly include raw materials, coal, minerals and intermediate goods.
