NEW DELHI, Apr 2: After India sealed the trade deal with Australia, Union Minister of Commerce and Industry, Piyush Goyal said that the agreement is profitable for both countries with Australia’s raw materials and India’s quality finished goods.
Union Minister said, “No one has expected that we would be able to seal the trade deal with developed countries like Australia. Australia is the country with whom we don’t have any competition. Australia has quality raw materials and India has quality finished goods. We both component each other. The agreement is a win-win for both countries.” The India-Australia Economic Cooperation and Trade Agreement (IndAus ECTA) was signed by commerce minister Piyush Goyal and his counterpart Australian trade, tourism and investment minister Dan Tehan in a virtual ceremony attended by Prime Minister Narendra Modi and his Australian counterpart Scott Morrison.
Goyal said that this trade pact will create one million jobs in the next 4-5 years, says Piyush Goyal, Minister for Commerce and Industry. This is the first trade agreement with a developed economy after more than a decade. This agreement will be signalling for other developed countries’ agreements such as the UK, Canada and the EU, with whom India is currently negotiating for Free Trade Agreement.
“We expect 1 million jobs creation in India in next 4-5 yrs. A number of new opportunities will open for Indian chefs and Yoga instructors in the time to come. We’ve also discussed the cooperation of education institutions between India and Australia,” Goyal said.
“We’re removing trade barriers which will lead to doubling of trade in the future that’ll have great potential for labour-oriented sectors. This free trade is expected to take bilateral trade from the existing USD 27 billion to nearly USD 45-50 billion in the next 5 years,” he added.
Union Minister pointed out the differences in Australia and Indian products imports. He said, “Australia imports homemade furnishing and Apparel heavily but the Indian share is very limited. Our apparel exporters told us that they only get a nominal margin and pay 5 per cent duty while exporting their products to Australia which is not a lucrative market, now when they get duty free access then they will benefit. Footwear, Automobile, Auto components, Leather, pharmaceuticals, gems and jewellery will benefit. IT and Technology, Research and Development, and the Tourism sector will also get the benefit from this deal.”
Minister said that there are over and around 1.3 lakh Indian students living and studying in Australia. “We’re looking at a work and holiday visa arrangement for promoting tourism. A post-study work visa between 2 and 4 years will be available for Indian students, particularly for STEM (Science, Technology, Engineering, and Mathematics) graduates. We have opened the way for students aspiring to study and work in Australia,” he said.
Talking about access to Australian wine, Goyal said, “We have consulted the Indian wine industry and stakeholders on multiple occasions. They had given us suggestions. They suggested us minimum import price for high-quality wines.”
“And assured them that their interest will be safeguarded. India will give concession and market access to Australian wine over and above the price tag of USD 5/750 millilitre. India doesn’t have any competition in this price tag. Investment and quality will come in the Indian wine market. Indian wineries will be benefitted from the investment and technology of Australia. Grape Farmers will get an opportunity. Indian winners can also sell their wines globally,” he added.
Australia is the 17th largest trading partner of India and India is Australia’s ninth largest trading partner. India-Australia bilateral trade for both merchandise and services is valued at USD 27.5 billion in 2021. India’s merchandise exports to Australia grew 135 per cent between 2019 and 2021.
India’s exports consist primarily of a broad-based basket largely of finished products and were USD 6.9 billion in 2021.
India’s merchandise imports from Australia were USD 15.1 billion in 2021, consisting largely of raw materials, minerals and intermediate goods. Three-fourths of India’s imports consist of coal, with 70 per cent of coal being coking coal. Australia has a surplus in merchandise trade of about USD 8 billion, primarily because of coal imports which are USD 11.2 billion.