New Delhi: – A free trade agreement has been signed between India and Australia after prolonged talks for ten years. India-Australia Economic Cooperation and Trade Agreement (Indus ECTA) was signed between the two countries in the presence of Prime Minister Narendra Modi and Australian Prime Minister Scott Morrison during a virtual meeting. This agreement between India and Australia is a historic agreement opening new doors for bilateral cooperation. Prime Minister Narendra Modi also underlined that this is a decisive moment for the bilateral relations between the two countries.
Last month, India signed a free trade agreement with the United Arab Emirates (UAE). After that, the free trade agreement was signed with Australia. This will boost Indian exports. It is claimed that the India-Australia trade will reach $50 billion in the next five years. Commerce Minister Piyush Goyal said that this would create 1 million employment opportunities. On Saturday, the agreement signed is an interim agreement signed before the final deal. It is claimed that the comprehensive agreement will be signed by the end of this year. The Indus ECTA has opened six thousand sectors in Australia for Indian traders. These include sectors like textiles, leather, jewellery and machinery. A tax-free entry will be available to Indian traders in Australia in these sectors.
Australia will get a tax-free entry for nearly 11,500 products in the Indian markets. Australia mainly exports raw materials to India. These include coal, steel, aluminium and other minerals. Discussions for the free trade agreement have been held for the last ten years between India and Australia. Finally, the discussions have turned into a reality.
Over the last one and a half years, the discussions had gained momentum given the current global scenario. There is tension reigning in China-Australia relations. China has stopped importing coal from Australia. The Coronavirus pandemic has jolted the economies of both countries. As it became clear that the increase in bilateral trade would be beneficial for both countries, given the disrupted supply chain, steps were initiated to expedite the process for the agreement. Australia had sent former Prime Minister Tony Abbot by the end of last year as a special trade representative to hold the talks regarding the deal. Abbot had claimed that India was a more trusted trading partner than China. This underlines the importance of the agreement between India and Australia.
Many countries are keen on signing such agreements with India, given the enormous Indian market. The Coronavirus pandemic has shown that dependence on a single government for the supply chain is dangerous. Therefore, all the big countries are searching for new trading partners and the Indian marketplace is inviting them. The discussions for the second phase have been completed for the free trade agreement between India and the United Kingdom. The talks with the European Union are in progress. Following UAE, the other Middle East countries also are keen on signing free trade agreements with India.
After signing the Indus ECTA agreement, Prime Minister Modi thanked Australian Prime Minister Scott Morrison and former Prime Minister Tony Abbot. Prime Minister Modi also said that he had issued orders to formalise the agreement.
At this time, Australian Prime Minister Morrison thanked Prime Minister Modi’s leadership for taking cognisance of the commendable cooperation between the two countries over the last few years. Morrison mentioned that this is one more important stage in strengthening bilateral relations between the two countries.
New horizons have been opened as two countries with rapidly expanding economies and similar ideologies work together. Australian Prime Minister Scott Morrison said that the agreement gives a clear message that the security and flexibility of the supply chain will be ensured.
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