Procurement of Indian-made goods could be poised to grow significantly Down Under following the cementing of a free trade agreement.
The India-Australia Economic Cooperation and Trade Agreement (ECTA) came into force late last month.
Under the agreement, introduced on 29 December 2022, Australia is providing zero-duty access to India for 100% of its tariff lines—98.3% from day one and the remaining 1.7% in a phased manner in five years.
Two-way trade in goods and services between Australia and India has grown in value from $13.6 billion in 2007 to $24.3 billion in 2020, according to the Department of Foreign Affairs and Trade.
Reports from India claim suppliers of pharmaceuticals, apparel, jewellery, transmission line towers, millets and glass have been first to take advantage of the slashing of Australian tariffs.
For Australian goods going the other way, tariffs on 85% of Australia’s exports to India will be eliminated and high tariffs on a further 5% of goods will be phased down.
“ECTA will save Australian exporters around $2 billion a year in tariffs, while consumers and business will save around $500 million in tariffs on imports of finished goods, and inputs to our manufacturing sector,” an Albanese Government media release said.
The Prime Minister Anthony Albanese is expected to enhance the deal upon a visit to India in March this year.
“The Australian Government is pursuing further opportunities in goods and services, in addition to new commitments in areas such as digital trade, government procurement, and new areas of cooperation,” the Government said in its media release.
