India-Australia Economic Cooperation and
Trade Agreement: Four Years of Achievements and Impact
India–Australia Economic Cooperation and Trade
Agreement (Ind-Aus ECTA) has completed four years since its signing on 2 April
2022, marking a significant milestone in the evolving economic partnership
between India and Australia.Over the past four years, the Agreement has
significantly strengthened bilateral economic engagement through improved
market access and reduced trade barriers.India’s exports to Australia have more
than doubled, while total bilateral trade reached USD 24.1 billion in 2024–25,
reflecting sustained growth in economic ties.The Agreement has emerged as a key
pillar of bilateral engagement, enhancing trade flows, fostering industry
linkages, and generating new opportunities for businesses, entrepreneurs, and
employment in both countries.
India–Australia ECTA
¨ The ECTA was signed on 2
April 2022 and came into force on 29 December 2022, providing an institutional
mechanism to promote and facilitate trade between the two countries.
¨
It covers almost all
tariff lines, ensuring comprehensive trade liberalisation.
Tariff Liberalisation
¨
Australia: Granted 100%
tariff line access to India; 98.3% became duty-free immediately, with the
remaining phased out over five years.
¨
From 1 January 2026, all
Indian exports enjoy zero-duty access to Australia.
¨
India: Granted
preferential access on 70.3% of tariff lines, covering 90.6% of trade value.
Sectoral Coverage
¨ India’s export gains:
Gems and jewellery, textiles, pharmaceuticals, agriculture, engineering goods,
automobiles.
¨ Australia’s export gains:
Focus on raw materials and intermediates such as coal, mineral ores, chemicals,
and fertilisers.
Trade in Services
¨
Australia: Offers access
in 135 sub-sectors, with Most Favoured Nation (MFN) status in 120 sub-sectors.
¨
India: Provides access in
103 sub-sectors for Australian services.
¨
Strategic Significance:
Australia is a key strategic partner of India through platforms such as the
Quadrilateral Security Dialogue and the Indo-Pacific Economic Framework for
Prosperity, reinforcing the broader Indo-Pacific economic and supply chain
cooperation.
Impact of India–Australia ECTA
Growth in Bilateral Trade
¨
India’s exports to
Australia increased from USD 4 billion (FY 2020–21) to USD 8.5 billion (FY
2024–25).
¨
Total bilateral trade
reached USD 24.1 billion in 2024–25.
¨
In FY 2025–26 (up to
February), trade stood at USD 19.3 billion.
¨
India’s exports recorded
an 8% growth in 2024–25.
Sectoral Expansion and
Diversification
¨
Export growth has become
broad-based, covering textiles, pharmaceuticals, chemicals, and agricultural
products.
¨
Increased access has
supported MSMEs, employment generation, and industry linkages.
Supply Chain Resilience
¨
Imports of essential raw
materials such as base metals, raw cotton, fertilisers, chemicals, and pulses
have strengthened manufacturing and domestic value addition.
¨
The complementary trade
structure has enhanced supply chain resilience.
Institutional and Regulatory
Cooperation
¨
The Mutual Recognition
Arrangement (MRA) on Organic Products (2025) has enabled seamless trade by
recognising certification systems, reducing costs, and improving transparency and
trust.
India-Australia Comprehensive Economic
Cooperation Agreement
¨
The India-Australia CECA
negotiations are ongoing, with the 11th round held in New Delhi (18–23 August
2025) covering areas such as goods, services, digital trade, rules of origin,
environment, and labour.
¨ India and Australia have
reaffirmed their commitment to a balanced and mutually beneficial agreement,
continuing discussions through intersessional meetings.
¨
The CECA builds upon the
India-Australia ECTA, which enabled early liberalisation of trade.
¨
Negotiations follow a
phased trajectory; initially launched in 2011, paused in 2016, and re-launched
in 2021.
¨
CECA aims to deepen
cooperation across trade, investment, and emerging sectors, with a target of
achieving AUD 100 billion bilateral trade by 2030.
