Australia is trying to resolve its differences with China in a careful deliberate way, but it would have no adverse impact on India as its joint interests with New Delhi were critical to regional prosperity and security, Australian Assistant Minister for Trade and Manufacturing Tim Ayres has assured.

In an interview with businessline on the sidelines of the recent G20 Trade and Investment Ministerial meet in Jaipur, Ayres talked about wide ranging issues including Australia’s free trade pacts with India, promising areas for cooperation and the global impact of Russia’s war with Ukraine.



How has been Australia’s experience with the recently- implemented India-Australia Economic Cooperation and Trade Agreement (ECTA) and the comprehensive economic cooperation agreement (CECA) being negotiated?

We are so delighted with the progress of the phase one India-Australia ECTA. It’s proceeded rapidly through both of our ratification processes. It is being implemented now for quite some months. 

And we are already five meetings, at senior official level, into negotiating phase two. There is enormous interest in the Australian commercial sector in the opportunities that we share between Australia and India. And we are very confident and very satisfied with the progress that we made.


But if you look at the first six months of this calendar year, trade both ways has gone down. What would you attribute it to? 

We are in very challenging global circumstances and trade levels will ebb and flow depending upon commodity prices, and what’s going on in the global economy.  What we do know is that our mutual trade is much stronger because of our phase one ECTA trade agreement. And it will be stronger still when we resolve the phase two agreement where we are.

In Australia, Prime Minister Albanese and the Australian government is optimistic and confident about the state of relations between India and Australia. And the trajectory is ever upwards.


ECTA phase one was a limited agreement as it did not cover many sectors including dairy. In phase two, what would be your areas of focus? 

I want to see cooperation deepened in areas like critical minerals, defense industry cooperation and new clean energy and hydrogen. We want to be part of the Indian booming manufacturing scene, supplying goods and services into Indian manufacturing supply chains.  We have our own aspirations to lift up Australia’s role in global supply chains and India is a core part of our agenda for trade diversification and economic growth.

We also see significant opportunities in higher education and in joint work in the digital area. I have with me very high-level delegation of Australian business people. From the head of our business council, through to our university vice chancellors and leading Australian businesses, all are here to talk about the opportunities.  Trade is of course about the commercial opportunities. But it’s also about the people-to-people opportunities and it’s about the things that we can do together to strengthen and diversify our economies.


Australia has a strong dairy and agriculture sector that were mostly excluded from phase one ECTA due to India’s sensitivities. Are you hopeful of gaining market access in these areas in phase 2?

We in Australia want the broadest possible agreement that incorporates as much of our two economies as possible. But in terms of the detail of progress that has been made in particular sectors, I’ve always found it wise to leave that to the negotiating table and wait until the end to make announcements about what’s in and what’s out.


Wines is one item where the ECTA phase one did come up with concessions for Australia. In phase 2, do you expect duty cuts to deepen in this particular sector? 

Well, as I said, I want the broadest possible approach. I’ll let the teams of officials continue their work. But we do have some of the finest wines in the world, which are very competitively priced. And we would really welcome the opportunity to enrich Indian dinner tables with more Australian wine.


Do you think that phase 2 ECTA, or the CECA as we call it, would also be concluded as fast as phase one?

I am optimistic. We are just a few months into the operation and we’re already five meetings deep in negotiations. That’s unparalleled speed for bilateral trade negotiations. Prime Minister Albanese and Prime Minister Modi have both made it clear to our trade ministers and our negotiating teams that they want to see ambitious progress on the CECA negotiations, and I think our teams are rising to that challenge and we’re making very good progress.


After some years of Australia distancing itself from China, which was also the period when it came closer to India, we now see numerous reports of Australia and China making up. Should it be a concern for India? Would this development have any impact on Australia’s interests in India?

There have been some challenges in Australia-China trade relationship. And Australia is working in a careful deliberate way to resolve those trade impediments. It is not in the interests of any country when impediments are put in place in front of free trade and countries should follow the rules. 

Australia’s interest in a joint approach with India is not only on meeting the economic challenges of our time and the climate and energy challenges of both our countries, but also the region in which we live. It is a joint approach to regional prosperity and security. These are absolutely critical joint interests that we have. And I’m very confident that the relationship is going to continue to evolve and strengthen.


How would you rate the discussions you have had at the G20 Trade and Investment Ministerial here in Jaipur?

I am delighted to be here in this G20 Trade and Investment Ministers meeting, hosted by India.  It has been an excellent opportunity at a bilateral level to engage on multiple issues, but also to see India’s leadership at the G20 on the trade and investment questions. 

We’ve got a big set of challenges in front of the world. In expanding international trade – in making sure that trade is a force for good and in making sure that we’ve got a rules-based trade system. India is providing very useful leadership in this G20. 


However, there were divisions over the Russia-Ukraine issue that prevented the G20 Trade Ministers from issuing a joint communique. Is that disappointing?

Russia’s illegal invasion of Ukraine underscores the need for strengthening global institutions and strengthening collaboration. It underscores the challenges that are there when unilateral action by one country has consequences well beyond the humanitarian crisis that has been created in Ukraine but has had consequences for all of us around the world, in terms of trade, in terms of energy prices and inflation. It absolutely underscores the need for deeper cooperation.

And I think this G20 Trade Ministers meet has really heard that message and countries have stood up. And it is Indian leadership that has helped us get there.