In what will be India’s first major free trade deal with a developed economy in more than a decade, the first phase of the agreement signed with Australia in April this year is likely to be operational soon, opening up markets for Indian services and goods. Access will be easy. The administration of Prime Minister Anthony Albanese, who took office a month after his predecessor and now leader of the opposition, Scott Morrison, signed Economic Cooperation and Trade Agreement (ECTA) With India, have taken it forward ratification through parliament, So, the India-Australia partnership has broad, bipartisan support in Canberra – that Australia is particularly troubled by what China calls the ‘weaponisation of trade’, which has certainly driven sentiment about India being a more trustworthy partner. helped to do. While both countries are already part of recently formed global groupings like the four-nation TractorTripartite Supply Chain Resilience Initiative and Indo-Pacific Economic Forum (IPEF)The bilateral trade deal is a strong positive signal about India’s credibility to the world, which is turning its back on dodgy supply chains towards a ‘China plus one’ strategy. Trading partners, some of whom are negotiating similar deals with India, will also be looking to outline the next phase of talks to cement a more comprehensive pact between the two countries.
India expects bilateral trade to grow from the current level of $31 billion to nearly $50 billion in five years, with Indian exports half of this growth, creating a million new jobs in labour-intensive sectors. Zero duty benefits on 98.3% of Australian tariff lines will be extended to all Indian products within five years, from the day the agreement comes into force. Australia, in turn, would get zero duty benefits for 90% of its exports (in value terms) to India. With raw materials such as coal, metals and wool dominating its shipments, it means cheaper inputs for Indian firms. Ties will be strengthened by annual visa quotas for Indian chefs and yoga instructors, and a post-study work visa regime for Indian students, as will Australia’s approval of a double taxation avoidance agreement, which will allow Indians to work for a year Millions of dollars are expected to be saved. IT Firm. As India pushes to close trade deals with the UK, EU and Canada, the wine import clause with Australia that envisages an industry-level partnership could serve as a template for other spirits as well. Can do. It is important to remember that trade deals open up new doors, but do not automatically mean higher exports or a better trade balance, as shown by India’s past agreements with ASEAN and Japan. There is no shortcut or option to fix India’s overall global competitiveness.