|Introduction: Contextual introduction.|
Body: Explain how ECTA will bolster bilateral ties.
Conclusion: Write a way forward.
India and Australia signed an Economic Cooperation and Trade Agreement (ECTA). Currently, Australia is the 17th largest trading partner of India and India is Australia’s 9th largest trading partner. The ECTA is expected to increase trade between the two sides to $45-50 billion over five years, from the current estimate of $27 billion.
How ECTA will bolster bilateral ties?
- There is a lot of potential for exporting finished goods to Australia, since Australia is largely a raw material and intermediate producing country.
- We will get cheaper raw materials which will not only make us more competitive globally but also enable us to serve Indian consumers better; enabling us to provide more quality goods at more affordable prices.
- The Agreement will also eliminate Double taxation on IT services which were making us less competitive and less profitable in IT sector.
- Indian goods on all tariff lines to get access to Australian market with zero customs duty. India will benefit from preferential market access provided by Australia on 100% of its tariff lines, including all the labour-intensive sectors of export interest to India, such as Gems and Jewellery, Textiles, leather, Automobiles etc.
- India will be offering preferential access to Australia on over 70% of its tariff lines, including primarily raw materials and intermediaries such as coal, mineral ores and wines.
- Both sides have also agreed to a separate Annex on Pharmaceutical products under this agreement, which will enable fast-track approval for patented, generic and biosimilar medicines.
- It is estimated that an additional 10 lakh jobs would be created in India under ECTA.
- Indian Yoga teachers and chefs are set to gain with the annual visa quota. Over 1 lakh Indian students would benefit from post-study work visa (for 18 months to 4 years) under the ECTA.
- ECTA will further boost India’s partnership with Australia along with Japan in trilateral Supply Chain Resilience Initiative (SCRI) and QUAD Grouping along with U.SA. and Japan.
ETCA will further cement the already deep, close and strategic relations between the two countries. It will significantly raise living standards, and improve the general welfare of the peoples of the two countries.