Australia is ready to eliminate import duties on all items from India. About 90 per cent immediately and the rest over the next five years. As part of the proposed free trade agreement (FTA), the country’s special envoy for trade Andrew Robb said the free trade pact officially known as the Comprehensive Economic Cooperation Agreement (CECA) is likely to be freezed in about 6-8 weeks.
According to Robb, this would translate into import duties on more than 9,000 items out of about 11,000 exported to Australia coming down to near zero as soon as the pact gets implemented and benefit sectors like auto parts, textiles, leather and pharmaceuticals.
The country has also agreed to ease visa norms for Indian workers as part of the pact, especially for intra-corporate transfers (ICT), the trade envoy said. In both goods and services, we have offered India the best of what we have extended to our other FTA partners.
Australia, on its part, wants India to lower duties in wines and high-end dairy products collaborate in the services sector and provide stability on investment policies. “We understand the sensitivities that India has in the goods sector. But, there are certain items such as high-end dairy products and wine where there is no domestic competition and duties can be lowered,” Robb said.
The proposed India-Australia Comprehensive Economic Cooperation Agreement (CECA) seeks to lower barriers in market access for goods, services as well as investments and bring about alignment in customs procedures and standards. Australia has signed FTAs with China, South Korea and Japan in the last two years and is also part of the US-led Trans Pacific Partnership (TPP).
Robb said that while Australia could provide expertise to India in a host of services such as construction, engineering, water management, health and education, it wanted the CECA to provide an assurance that India’s policies related to investments in a particular sector would not change in the middle of project-execution.
Currently, India-Australia bilateral trade was about $14 billion in 2014-15, with Australian exports at $11 billion and Indian exports just at $3.2 billion. The two countries hope to increase two-way trade to at least $40 billion by 2020, which would still be much lower than Australia-China’s $160 billion worth of annual trade.