Under the historic Economic Cooperation and Trade Agreement between India and Australia, Australia will reduce duties on all tariff lines (Ind-Aus ECTA)
ECTA will improve people's ability to communicate with one another, which will result in the creation of additional businesses, a significant rise in exports and investments, and employment opportunities for over one million people.
Shri Piyush Goyal, who serves as the Union Minister for Commerce and Industry, Consumer Affairs, Food and Public Distribution, and Textiles, announced that under the historic India-Australia Economic Cooperation and Trade Agreement, Australia will do away with duties on tariff lines that are subject to a hundred percent tariff (Ind-Aus ECTA). Following today's vote in the Australian Parliament to ratify the Agreement, he was speaking at a press conference about the ECTA.
Minister expressed his gratitude to Prime Minister Shri Narendra Modi and stated that the ECTA was made possible because of the bond that he had built with the leadership in Australia, which transcended party lines. Minister also said that the ECTA was made possible because of the bond that he had built with the leadership in Australia.
According to Shri Goyal, the ECTA will provide a significant boost to a number of different areas of the economy, including the textiles, gems and jewellery, and pharmaceuticals industries. It is important to keep in mind that it is anticipated that the ECTA will result in the creation of 10 lakh new jobs. He pointed out that the Agreement would also provide new chances for the service sector in India and would be of tremendous advantage to students by providing them with the option to work in Australia. He said that both of these things would be possible as a result of the Agreement. The number of visas available to India will be capped at 1800 per year for yoga instructors and chefs.
The Minister emphasised that the Agreement was reached following extensive and exhaustive negotiations with all of the relevant stakeholders, and she drew attention to the fact that the Agreement was unanimously recognised and supported by all parties.
Shri Goyal made the observation that the Agreement represented the mutual confidence and trust that exists between the two countries, as well as India's ascending status in the international community. He stated that the ECTA would further improve India's connection with Australia, a thriving democracy that shared several of India's goals. He also mentioned that the ECTA would be beneficial for both countries.
The Indo-Australian Economic and Trade Agreement (Ind-Aus ECTA), which was signed on April 2, 2022, is now ready for ratification for its early implementation. The Ind-Aus ECTA Bill and the DTAA amendment bill have both been passed by the Australian Parliament today, and the Ind-Aus ECTA Bill is currently being placed before the Executive Council to get Royal Assent. The Agreement will soon go into effect, at a date that is agreeable to both parties, as soon as both parties have finished the necessary procedures in their respective countries.
Both democracies are members of the four-nation QUAD, the Trilateral Supply Chain Initiative, and the Indo-Pacific Economic Forum. Australia is a significant strategic partner of India (IPEF). The trade connection between India and Australia, which will be enabled through ECTA, will create a new chapter in the Comprehensive Economic Partnership between the two thriving countries, both of which have trade complementarities and common interests. The foundation of our multifaceted bilateral relations is this agreement, which was started by the honourable prime ministers of both countries. After more than a decade of negotiations, India has reached a trade agreement with a developed nation through the ECTA. The Agreement calls for cooperative endeavours to be undertaken across the full spectrum of economic and commercial ties that currently exist between the two amicable nations. Additionally, this will connect with more than seven lakhs of Australia's Indian diaspora, which is the second greatest taxpaying diaspora and makes a substantial contribution to Australia's society as well as its economy.
The Economic and Trade Agreement (ECTA) establishes an institutional system to foster and foster commerce between the two nations. In contrast to the decisions made during the prior FTAs, this one was the first one to totally base decisions on thorough stakeholder consultations with each and every industry, several ministries, and various trade associations. With the implementation of this agreement, it is anticipated that the overall value of bilateral commerce will increase to between US$ 45 and 50 billion during the next five years, up from the current value of US$ 31 billion. It is anticipated that India's Merchandise Exports will rise by 10 billion dollars by 2026-2027. In addition, given that labor-intensive industries would be favoured, it is anticipated that it will result in the creation of an additional employment of at least 10 lakhs jobs in India, as well as an abundance of prospects for investment and the promotion of new business ventures. Additionally, it would boost the number of job opportunities available to Indians living in Australia and the amount of money that was sent back to India.
Roughly 96% of Australia's total exports are comprised of raw materials and intermediate products. This will enable a great number of Indian industries to obtain cheaper raw materials and improve their level of competition. Investments will help increase presence of items with higher value and more advanced technology, which will promote vertical movement in the value chain (Engineering, Electronics, Pharmaceuticals & Medical devices). Another significant advance has been made in the pharmaceutical industry, which now offers a streamlined process for the approval of proprietary, generic, and biosimilar versions of drugs that have already been commercialised in other industrialised countries.
In terms of trade in services, Australia has offered significant commitments in approximately 135 subsectors. These commitments cover key areas of interest to India, such as information technology (IT), information and technology-enabled services (ITES), business services, health, education, and audio visual services. Quotas for chefs and yoga teachers; post-study work visas of 2-4 years for Indian students on a reciprocal basis; mutual recognition of professional services and other licenced or regulated occupations; and work and holiday visa arrangements for young professionals are some of the most important offerings that Australia has made in the services sector. In addition, the issue of double taxation that had been pending for a long time in relation to IT and IT services has been resolved as a result of this Agreement, which will result in cost reductions of more than US$ 200 million annually according to the estimates that were obtained from the Industry Associations.
In accordance with the obligations made under ECTA, the Chief Negotiators from both sides will get together very soon in order to put the finishing touches on the Scoping paper for the Comprehensive India–Australia ECTA.
The India-Australia Economic and Commercial Trade Agreement (ECTA) will, in a nutshell, further cement the already profound, close, and strategic relations between the two countries. It will also significantly enhance bilateral trade in goods and services, create new employment opportunities, raise living standards, and improve the general welfare of the people of the two countries.