Last week, Australia and India agreed to reach Free Trade Agreement (FTA) by December 2022 and an early harvest trade deal by December this year to deepen bilateral trade in goods and services.
Last Thursday, during a joint press conference in Delhi after the 17th India-Australia Joint Ministerial Commission meeting, Australian Minister for Trade, Tourism, and Investment Dan Tehan and Indian Minister for Commerce and Industry Piyush Goyal announced their decision to resume negotiations on the India-Australia Comprehensive Economic Cooperation Agreement (CECA) and decided on aggressive timelines to conclude the trade agreement.
The trade agreement was suspended in 2015 after India, led by Prime Minister (PM) Narendra Modi, ordered a review of all trade negotiations initiated by the previous government. However, last June, Modi and Australian PM Scott Morrison agreed to revive bilateral trade talks and speed up negotiations.
While commenting on the aggressive timeline agreed upon by both sides, Goyal said, “This is like a T-20 match, that is why such aggressive timelines. The spirit of this partnership is that both India and Australia work in the same team for a win-win for each other.” Furthermore, Goyal noted the countries’ positive attitude towards promoting trade, which could be fast-tracked via the interim agreement. Concerning the interim deal, he said the agreement would include sectors that need immediate engagement and called them “low hanging fruits.”
Likewise, Australian Trade Minister Tehan reaffirmed the countries’ commitment to reach an FTA next year and an interim agreement by Christmas. Tehan said, “It will be consistent with Article 24 of the WTO, and it will cover goods, services, investment, we will begin discussing government procurement energy and resources, logistics and transport, standards, rules of origin, and we have agreed to exchange offers by the end of October. Now, this is extraordinarily ambitious.”
Furthermore, the ministers also agreed to cooperate on achieving “an ambitious and balanced” outcome at the 12th World Trade Organization’s (WTO) Ministerial Conference, which is scheduled to take place in Geneva, Switzerland from 30 November to 3 December later this year.
The proposed trade agreement is likely to cover trade in goods and services and investments, amongst other things. Additionally, under the early harvest trade deal, duties on certain items will be reduced. Last year, the bilateral trade between India and Australia exceeded $17 billion.
Tehan also mentioned that the current trade between the two countries didn’t justify their economic partnership and acknowledged that the FTA would double the trading relationship. In this regard, Tehan said, “This growth will be across all areas because of the complementarities in the two countries’ industries. Australian wool, merino wool, can go into the best textiles in India, and those textiles can be exported to the rest of the world.”
The Ministers have agreed to exchange initial proposals regarding the CECA by October. However, the final trade deal, pending since July 2011, will be concluded by December 2022.
Australia, India to Reach Free Trade Agreement by December 2022
The trade ministers of India and Australia, Piyush Goyal and Dan Tehan, agreed to finalise the Free Trade Agreement by December 2022 and an interim agreement by December this year.
October 5, 2021
SOURCE: DECCAN HERALD