India, Australia aim to finalise trade pact by end of next year

Early harvest pact will be signed by Christmas

India and Australia are looking to finalise a Comprehensive Economic Cooperation Agreement (CECA) by the end of 2022, which will help expand trade between the two nations.

Both nations aim to sign an early harvest trade deal by Christmas that will cover areas of immediate interest. Exchange of the first list of offers will be done by the end of October. Commerce and industry minister Piyush Goyal said both countries have set out “ambitious” timelines and targets. Both negotiating teams will start working immediately.

“We have a lot of good things that can benefit Australia, and Australia also has a lot of things that can benefit India. It has goods, services, and investment opportunities,” Goyal told reporters after a meeting with Australia’s trade, tourism and investment minister Dan Tehan in the national capital.

“It (the trade deal) will cover goods, services, investments, government procurement, logistics, standards, and rules of origin. We have decided to exchange offers by the end of October,” Tehan said. 

There will be dedicated negotiating teams interacting to sign the deal quickly, he said, adding that after the deal is inked, trade between the two nations might double. In the past, a trade deal with Australia was put on hold as both countries were not able to reach a conclusion due to lack of consensus on various issues.

“What has been discussed in the past will always be there before us and help us speed up negotiations. We will, however, bring in a fresh perspective to the talks,” Goyal said.

India-Australia bilateral trade exceeded AUD24 billion last year. Major Indian exports to Australia are petroleum products, medicines, polished diamonds, gold jewellery, apparels, etc., while key Australian exports to India include coal, LNG, alumina and non-monetary gold. 

In services, major Indian exports relate to travel, telecom and computer, government and financial services, while Australian services exports were principally in education and personal travel.

In 2020, India was Australia’s seventh-largest trading partner and sixth largest export destination, driven by coal and international education.