The free trade agreement between India and Australia will be implemented starting on December 29, aiming to nearly double bilateral commerce to USD 45-50 billion within five years.
Australian Minister for Trade and Tourism Don Farrell announced that the Indian Government has completed its domestic requirements for the Australia-India Economic Cooperation and Trade Agreement (ECTA) to take effect.
This trade deal will create new market opportunities for Australian businesses and consumers starting from December 29, 2022.
Commerce and industry minister hailed the implementation of the free trade pact as the beginning of a new era for India-Australia partnership.
Goyal, in a tweet, emphasized the significance of the Economic Cooperation and Trade Agreement between India and Australia, effective from December 29, 2022, marking a new chapter for businesses and people.
The agreement, signed on April 2, will grant duty-free access to Indian exporters in various sectors like textiles, leather, furniture, jewelry, and machinery in the Australian market.
Key sectors set to benefit include textiles, apparel, agriculture, fish products, leather, footwear, furniture, sports goods, jewelry, machinery, and electrical goods.
Australia will offer duty-free access to India for 96.4% of exports from day one, covering products currently subject to 4-5% customs duty.
India’s goods exports to Australia were valued at USD 8.3 billion, while imports were at USD 16.75 billion in 2021-22.
The agreement will eliminate tariffs on 85% of Australia’s exports to India from December 29, with an additional 5% of goods seeing reduced tariffs.
The ECTA is projected to save Australian exporters about USD 2 billion annually in tariffs, with USD 500 million in savings for consumers and businesses on imports.
India’s tariff commitments will benefit Australian exporters of critical minerals, pharmaceuticals, cosmetics, lentils, seafood, sheepmeat, horticulture, and wine.
Australian service providers will gain access to over 85 Indian services sectors, with guarantees of treatment equivalent to India’s other free trade agreement partners.
The agreement will also facilitate tourism and workforce needs in regional Australia, offering 1,000 work and holiday program spots to young Indians, with post-study work opportunities for high-performing STEM graduates.
Australia and India are working on a Comprehensive Economic Cooperation Agreement to expand on the ECTA, covering goods, services, digital trade, government procurement, and other areas of cooperation.
Australian Prime Minister Anthony Albanese highlighted the agreement’s importance in strengthening the relationship with India, the world’s fastest-growing major economy.
Minister Don Farrell emphasized the immediate benefits of the ECTA for exporters with two quick tariff cuts, urging businesses to prepare for improved market access to India.
Businesses are urged to prepare for increased market access to India under the new agreement, with assistance available from Austrade to navigate trade barriers.
