India and Australia have signed a trade and economic cooperation agreement
India and Australia on Saturday signed an economic cooperation and trade agreement under which Canberra would provide duty free access in its market to over 95 per cent of Indian goods such as textiles, leather, jewellery and sports products.
The India-Australia Economic Cooperation and Trade Agreement was inked by Commerce and Industry Minister Piyush Goyal and Australian Minister for Trade, Tourism and Investment Dan Tehan in a virtual ceremony, in the presence of Prime Minister Narendra Modi and his Australian counterpart Scott Morrison.
This is truly a watershed moment for India-Australia relations, Mr Modi said.
The Prime Minister underlined the huge potential that exists in the two economies to fulfil the needs of each other and said that this agreement will enable the two countries to fully leverage these opportunities.
“This is a watershed moment for our bilateral relations. On the basis of this agreement, together, we will be able to increase the resilience of supply chains, and also contribute to the stability of the Indo-Pacific region,” Mr Modi added.
Terming "people to people" relations as the key pillar of the relationship between India and Australia, the Prime Minister said that this agreement will facilitate the exchange of students, professionals, and tourists between the two countries, which will further strengthen relations.
Mr Morrison said that the pact will further deepen Australia's close ties with India.
The Australian Prime Minister further added that this is the single largest Australian government investment in his country's relationship with India, indicating that it won't be the last. He further said that the signing of the pact marks another milestone in the bilateral relationship.
The agreement will help in taking bilateral trade from $27 billion to $45-50 billion in the next five years, Mr Goyal said.
Australia is offering zero duty access to India for about 96.4 per cent of exports (by value) from day one. This covers many products which currently attract 4-5 per cent customs duty in Australia.
Labour intensive sectors which would gain immensely include textiles and apparel, few agricultural and fish products, leather, footwear, furniture, sports goods, jewellery, machinery, electrical goods and railway wagons.
Australia is the 17th largest trading partner of India, while New Delhi is Canberra's 9th largest partner. Bilateral trade in goods and services stood at $27.5 billion in 2021.
India's goods exports were worth $6.9 billion and imports aggregated to $15.1 billion in 2021.
Major exports by India to Australia include petroleum products, textiles and apparels, engineering goods, leather, chemicals and gems and jewellery.
Imports mainly include raw materials, coal, minerals and intermediate goods.