The Economic Cooperation and Trade Agreement (ECTA) between India and Australia will come into force soon.

Under the deal, Australia will provide India duty-free access to more than 6,300 sectors on the day the agreement comes into force. India, for its part, will do away with customs duties on 40 per cent of products immediately and on 70.3 per cent of tariff lines over ten years.

Major labor-intensive sectors in India that will benefit from the elimination of five per cent customs duty include textiles and apparel, agricultural products, leather, furniture, jewellery, and pharmaceuticals.

ECTA will help in taking bilateral trade to $50 billion in the next five years and will also offer relief to Indian IT companies operating in Australia, as Australia has agreed to amend its laws to stop taxing offshore income of such companies. The determination of the origin of goods rules has been issued under the India-Australia free trade agreement. Each FTA has its own origin rules and nuances. The onus is on the Indian importer to ensure that the said rules are duly complied with.

For companies looking to take advantage of the Indian- Australia FTA, a detailed perusal and compliance of the origin rules remains indispensable. Strict rules of origin have been included in the ECTA to prevent third-party goods routing through Australia. Product-specific Rules of Origin (PSRs) have been agreed for 807 lines.