Australian Parliament Approves Free Trade Agreement with India
·
ECTA
will be Greatly Welcomed by our Business Communities: PM
The Prime
Minister, Narendra Modi has thanked Australian PM, Anthony Albanese as Australian
parliament approves free trade agreement with India.
Mr. Modi also said that
Economic Cooperation and Trade Agreement (ECTA) will be greatly welcomed by our
business communities, and will further strengthen the India-Australia Comprehensive
Strategic Partnership.
In response to a tweet
by Australian PM, Anthony Albanese, the Prime Minister tweeted;
"Thank you PM @AlboMP! The entry into force of IndAus
ECTA will be greatly welcomed by our business communities, and will further strengthen
the India-Australia Comprehensive Strategic Partnership."
'Boost for
pharma'
The FTA will
also provide a big boost to the pharmaceutical industry in India.
Medicines
which have gone through rigorous approval process by USA & UK will now have
fast tracked mechanism to get approval in the Australian Regulatory system,
Goyal noted.
'Opportunities
across sectors'
The
agreement opens up significant new opportunities across sectors for Indian
businesses.
"India’s
textiles and gem and jewellery sectors have been keenly waiting for the agreement
to be able to sell to high income earners in Australia," Goyal said.
The
agreement, once implemented, will provide duty-free access to the Australian
market for over 6,000 broad sectors of India, including textiles, leather,
furniture, jewellery and machinery.
Under the
pact, Australia is offering zero-duty access to India for about 96.4 per cent
of exports (by value) from day one. This covers many products that currently
attract 4-5 per cent customs duty in Australia.
The
India-Australia Economic Cooperation and Trade Agreement (AI-ECTA) needed
ratification by the Australian parliament before its implementation. In India,
such pacts are approved by the Union Cabinet.
Meanwhile,
Australian trade minister Don Farrell in a statement said that the ECTA will
enter into force 30 days (or another mutually agreed time) after the respective
parties have confirmed in writing that they have completed their domestic
requirements.
Farrell
added that the agreement will support businesses to grow, to offer more employment
opportunities, and will give Australian consumers more choice at the checkout.
He further
said that Australia will work closely with the Indian government to implement
the trade agreement "as soon as possible".
This is the
first time in Australia’s history, where they are giving 100 per cent tariff
lines with most lines on entry into force and 113 lines within a period of 5
years.
Position
of major interest groups in Australia
Stakeholders
have been broadly supportive of the ratification of the ECTA, noting it
will be a stepping-stone to a broader comprehensive agreement with India. For
example, the Group of Eight (a peak body representing Australia’s leading
research-intensive universities) welcomed the ECTA for facilitating
educational exchange opportunities with Indian students providing them with
more post-study work rights in Australia.
The
Business Council of Australia (BCA) noted the ECTA is a ‘welcome and
important step in the journey towards a greater trade and investment
relationship’ with India. The BCA submitted that that the Government must
redouble its efforts to conclude a full CECA as soon as possible and listed a
number of areas which would require further work, including investment
protections, promoting greater labour mobility and greater agriculture access
for Australian exporters.
While
India has agreed to reduce tariffs on products such as Australian wine and
sheep meat, a number of key sectors of interest to Australia (for example,
dairy, sugar and wheat) remain subject to high tariffs.
Spirits
and Cocktails Australia and the Australian Distillers’ Association expressed
their disappointment that the ECTA did not remove ‘the very high tariffs
faced by imported spirits’ into India. Stakeholders also questioned the ‘lack
of ambition’ with respect to products where tariffs were reduced, with Pernod
Ricard Winemakers (which produces Australian wine brands Jacob's Creek, St
Hugo, George Wyndham and Orlando) stating that the ECTA ‘represents a
missed opportunity to open up a critical growth market at a really delicate
time in our industry’.
Queensland
Canegrowers Association Ltd noted that ‘India has failed to make new
commitments on sugar’ and raised concerns regarding ‘India’s reluctance to
abide by its existing international (WTO) trade obligations with respect to
sugar and its general reluctance to constructively engage in trade negotiations
affecting agriculture’.
The
Australian Council of Trade Unions (ACTU) raised a number of concerns regarding
the ECTA and called for the agreement to be re-negotiated. In
particular, the ACTU argued that the commitments made by Australia in the ECTA
with respect to temporary workers are not consistent with the Government’s
policy to preference permanent migration and do not protect migrant workers.