India and Australia must aim to increase bilateral trade to $100 billion annually, from the existing $30 billion, as both sides attempt to wrap up the negotiations for expanding the existing free trade pact by the year-end, Commerce and Industry Minister Piyush Goyal has said.
“We are very dissatisfied with $30 billion of trade between Australia and India. The officials had kept an annual target of $45-50 billion (to be achieved) in next five years. Both Ministers expressed our unhappiness with the target,” Goyal said at a joint press conference with his Australian counterpart Don Farrell following a meeting of the joint ministerial commission on Saturday.
“We do hope we will be much more ambitious and aim for $100 billion between the two economies,” he said, adding that this confidence demonstrated the type of trade, trust and friendship that the two countries have.
Farrell pointed out that the Australia-India Economic Cooperation and Trade Agreement (ECTA), implemented on December 29, 2022, had already started delivering results.
“To start the process, in the first month of the current agreement, $2.5 billion worth of Australian products was brought into India at lower tariffs,” he stated.
There was a huge scope for increased cooperation in a number of areas such as critical minerals, digital space and sustainability in the Comprehensive Economic Cooperation Agreement (CECA) being negotiated now, he said.
“The Prime Ministers of both countries have tasked the Trade Ministers to close the CECA negotiations within this calendar year and we would hope for speedy outcomes without compromises,” Goyal noted.
While the ECTA liberalised tariffs in most goods traded between the two countries, certain sensitive sectors, such as dairy and some farm products, were kept out of it.
The Indian Minister expressed appreciation for the Australian government and businesses who understood India’s sensitivities in dairy. “I had met farmers associations in Perth. I was truly amazed at their open minds and ability to see the different conditions in which the two countries are operating,” said.
Goyal said there were a lot of areas with ‘win-win’ opportunities being explored by the two in the CECA. “ECTA was the first stage of our economic engagement, he said. We are now entering into phase-2 of our discussions where we are looking at much wider ambit of subjects and taking this into a CECA,” he said.
Areas with potential include innovation, space technology, education systems, critical energy, critical minerals, energy storage systems, defence and sports, to name some.
On import tariff
Farrell said that India’s decision to bring down import tariffs on wines from 150 per cent to 75 per cent under the ECTA had enabled a partnership that was benefitting both countries.
Agreeing with Farrell, the Indian Minister said that with the right quality and technology, India had the potential of becoming a big exporter of wine.
Farrell is part of Australian Prime Minister Anthony Albanese’s delegation who is in India on an official visit.