India-Australia trade deal to get Presidential assent in a day or two
In a presentation on Tuesday, Piyush Goyal said the ECTA will lead to the elimination of duty on 100 percent of tariff lines - for the first time.
Union minister Piyush Goyal said the Commerce Ministry has sent the India-Australia Economic Cooperation and Trade Agreement (INDAUS ECTA) for Presidential assent. He said the approval is likely to be received in a day or two. This came after Australia’s Parliament passed bilateral free trade agreements with India and Britain on Tuesday.
In a presentation on Tuesday, Piyush Goyal said the ECTA will lead to the elimination of duty on 100 percent of tariff lines - for the first time. He adds that the deal will help labour-intensive sectors like textiles, agriculture, fish products and jewellery. It is also expected to create 10 lakh jobs in India, the government said.
Meanwhile, the Double Taxation Avoidance Agreement (DTAA) will lead to savings of $200 million per year (NASSCOM estimate), Piyush Goyal said. "This benefit will increase year by year and may reach 1 billion," he added.
"No restriction on quota reflects confidence and trust between India and Australia. The ECTA reflects India's growing stature in goods and services. Stakeholder consultation was conducted with all sectors unlike FTAs around a decade back," the minister said.
Goyal also mentioned that for the first time, India has got visas for its yoga teachers and chefs. "Indian STEM graduates will get up to 4 years of work visa," he said. He said he has spoken with Australian leaders for recognition of dual degrees. "Dual degrees will also allow India to earn forex with Australian students being able to come to India," he said.
Highlighting the possible boost in the pharma industry, he said the industry "will get a big boost as US FDA-approved medicines will have a fast-track mechanism to get approved in Australia".
Grape farmers are also expected to benefit from the ECTA, Goyal said mentioning that Rs 500 crore investment was received by the Indian wine industry till now.
The government said the total bilateral trade is expected to cross US $45-50 billion in five years from the existing US $31 billion. "India's merchandise exports expected to rise by $10 billion by 2026-27," it said.
Bill passed by Australia
The deals are crucial for Australia as well to diversify its exports from the troubled Chinese market to India and to Britain’s need to forge new bilateral trade relations since it left the European Union.
The bills easily passed the House of Representatives on Monday and the Senate made the law on Tuesday. The deals need to be ratified by the respective British and Indian parliaments before they take effect. Neither nation has yet done that.
BREAKING: Our Free Trade Agreement with India has passed through parliament. (📷 with @narendramodi at the G20) pic.twitter.com/e8iG3gpTgr
— Anthony Albanese (@AlboMP) November 22, 2022
Trade Minister Don Farrell said India had demonstrated its commitment to the bilateral economic partnership through the quality of the deal struck. “Closer economic ties with India are a critical component of the government’s trade diversification strategy,” Farrell said. Farrell said the British deal was “crucial to boosting our growth.”
Trading With Trust 🇮🇳 🤝🇦🇺
Delighted that India-Australia Economic Cooperation & Trade Agreement has been passed by Australian Parliament.A result of our deep friendship, it sets the stage for us to unleash the full potential of our trade ties & spur massive economic growth.— Piyush Goyal (@PiyushGoyal) November 22, 2022
Under the Australia-Britain deal, more than 99% of Australian goods exports will be duty-free, including sheep meat, beef, dairy, sugar and wine. Taxes on 90% of Australian goods exported to India including meat, wool, cotton, seafood, nuts and avocados will also be removed.
Prime Minister Anthony Albanese discussed the deals with Indian Prime Minister Narendra Modi and British Prime Minister Rishi Sunak last week on the sidelines of the Group of 20 summits in Indonesia. Albanese said he would visit India in March to advance the deal that was signed in April.
The British deal was signed in December by then-Prime Minister Boris Johnson’s administration and has been criticized by its successors for failing to deliver more for Britain.
The deals would come into force 30 days after countries have advised each other in writing that the supporting legislation has been passed by their parliaments.
(With inputs from agencies)
First Published: Nov 22, 2022 1:00 PM IST
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