New government in Australia to support trade pact with India
The change of government in Australia will not adversely affect the India-Australia free trade pact signed in April this year as the Labour Party wants a comprehensive trade agreement with New Delhi, just like the former government, Australian High Commissioner to India Barry O’Farrell has said.
“As Madeliene King (Labour Party trade spokesperson) noted last week, labour will deliver a bill on what its predecessor has done and not tear it down. We look forward to the resumption of negotiations on the closer (comprehensive) economic co-operation agreement which are due to start in June this year,” O’Farrell said at the Indo-Australian Chamber of Commerce in New Delhi earlier this week.
India and Australia signed the bilateral Economic Cooperation and Trade Agreement (ECTA) on April 4 with commitments to liberalise trade in goods and services. The free trade pact is likely to almost double bilateral trade in goods to $50 billion in five years from about $27 billion at present, per government estimates.
According to the trade deal, the two sides will now negotiate a Comprehensive Economic Co-operation Agreement that will include items that have been kept out of ECTA including many farm products and chapters on areas such as digital trade and government procurement.
“ECTA gives us both the opportunity to harness the complimentary nature of our economies in areas such as critical minerals, professional services, education and tourism. Indian consumers and businesses will benefit through elimination of tariffs on 85 per cent of Australia’s goods exports to the country while Australian consumers will benefit by 96 per cent of your goods coming to Australia duty free,” O’Farrell pointed out.
On clean energy
Australia is in a prime position to help India reach its clean energy goals through supply of lithium and other critical minerals, he added. “ECTA will provide certainty in supply of high quality, competitively priced critical minerals to India which are essential to production of high end technical goods such as electric cars and solar panels. This can support India’s ambition to play a major role in advance manufacturing,” the High Commissioner said.
While the Australia-India ECTA has already been tabled in Australian Parliament on April 4, it will next have to be considered by the Joint Standing Committee on Treaties. The process of ratification of ECTA may take up to six months if things move smoothly so the industry would need to wait a while to take advantage of the duty cuts.
“The historic India Australia ECTA promises to unlock a wide range of bilateral trade and investment opportunities, offering our members commercial benefits like easier market access, lower tariffs and other concessions,” pointed out IACC CEO, Petula Thomas.
The IACC has just launched its Northern India Chapter to build stronger economic ties between Northern India & Australia.
May 26, 2022