India-Australia agreement to double bilateral trade to USD 45 billion in 5 yrs: CII
Dec 28, 2022
Mumbai (Maharashtra) [India], December 28 : The implementation of the Economic Cooperation and Trade Agreement (ECTA) between India and Australia has the potential to double bilateral trade in goods and services to USD 45 billion in the next five years, said the Confederation of Indian Industry (CII).
The industry body CII noted that zero-duty access to Australia's market will be available to India immediately as the ECTA comes into force starting Thursday.
The trade arrangement is expected to lead to a USD 10 billion jump in India's merchandise exports by 2026-27, and would help in creating additional 10 lakh jobs in India.
The agreement encompasses cooperation across the entire gamut of bilateral economic and commercial relations between the two friendly countries.
CII added that besides providing cheaper raw materials to many sectors, including steel and aluminium from Australia, the agreement would also facilitate increased investments from Australia and will support Indian manufacturing.
The significant boost for India, the CII said, would be in its labour-intensive sectors, which are currently subject to import duty of 4-5 per cent by Australia.
"The sectors that would gain immediately are textiles and apparel, leather and footwear, furniture, sports goods, jewellery, machinery, railway wagons and select agricultural and marine products," the CII said on Wednesday.
India, on the other hand, is providing zero-duty access to Australia for 70.3 per cent of its tariff lines (40.3 per cent tariff lines from day one and the remaining 30 per cent in a phased manner). India has offered zero duty access on coal, alumina calcined, manganese ore, copper concentrates, bauxite, sheep meat, rock lobster, macadamia nuts, cherries, and wool.
About 96 per cent of Australia's exports to India comprise raw materials and intermediate products. Therefore, the tariff concessions offered by India will allow local/domestic industries to get cheaper raw materials and enhance their competitiveness.
The CII said it is also looking forward to various opportunities for trade in services.
It said Australia had made wide-ranging commitments in around 135 sub-sectors with most-favoured-nation (MFN) status in around 120 sub-sectors.
The major gains would be for the Indian IT sector followed by healthcare and education, and service professionals such as yoga teachers and chefs.
