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India-Australia ECTA to 'double bilateral trade' to $45bn
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IANS | 18 Jan, 2023
The Confederation of Indian Industry (CII) Northern Region on Wednesday
organised a business outreach session on sector-wise opportunities and
benefits arising out of the India-Australia Economic Cooperation and
Trade Agreement (ECTA).
The session aimed to brief the industry on the gains for the Indian industry arising out of this Free Trade Agreement (FTA).
Tapan
Mazumder, Additional Director General of Foreign Trade, Department of
Commerce, Union Ministry of Commerce and Industry, said the major boost
for India would be in its labour-intensive sectors, which are currently
subject to import duty of 4-5 per cent by Australia.
"The
Department of Commerce is having talks with the Australian government
for bringing in investments in clean air technology, mining, education
and research and development. The warehousing systems in Australia can
be used as a gateway to New Zealand, Fiji and Papua New Guinea where
Indian presence is miniscule," said Mazumder.
Further, he urged
the CII and the industry to work together and give more information to
the Department of Commerce so that the bilateral relationship between
India and Australia can be strengthened.
P.J. Singh, Vice
Chairman, CII Punjab State Council, said the implementation of the ECTA
between India and Australia has the potential to double bilateral trade
in goods and services to $45 billion in five years.
Congratulating
the Prime Ministers of the two countries for the quick conclusion of
the agreement, Singh noted zero-duty access to Australia's market is
available to India presently with the ECTA entering into force on
December 29, 2022.
Australia will provide zero-duty access to
India for 100 per cent of its tariff lines (98.3 per cent tariff lines
from day one and the remaining 1.7 per cent in a phased manner in five
years).
This is expected to lead to $10 billion jump in India's
merchandise exports by 2026-27 and would help in creating additional 10
lakh jobs in India and more job opportunities in Australia.
Besides
providing cheaper raw materials to many sectors, including steel and
aluminium from Australia, the ECTA would also facilitate increased
investments from Australia and will support Indian manufacturing, said
Singh.
Virendra Pal Singh Mongia, Regional Head, EXIM Bank, said
Australia and India are increasingly working together as strategic and
economic partners. India-Australia ECTA is a ground-breaking agreement
that will leverage the industry to capitalize the enormous untapped
potential.
The agreement is expected to boost investments,
enhance market access, create additional job opportunities, and most
importantly strengthen the bilateral ties of two important players in
Indo-Pacific region.
About 96 per cent of Australia's exports to
India comprised of raw materials and intermediate products, thus the
tariff concessions offered by India will allow local and domestic
industries to get cheaper raw materials and enhance their
competitiveness.
The CII said in a statement that it is also
looking forward to various opportunities for trade in services.
Australia has made wide ranging commitments in around 135 sub-sectors
with most-favoured nation (MFN) status in around 120 sub-sectors.
The
major gains are for the Indian IT sector followed by healthcare and
education, and service professionals such as yoga teachers and chefs.
The
CII expects that the deal would provide large Indian IT companies to
increase their involvement in Australian government projects. The deal
enables India and Australia to collaborate and develop niche skill sets,
provide global digital solutions, and further develop fintech
capabilities.
On the other hand, India is making commitments in around 103 service sub-sectors with MFN in 31 sub-sectors.
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