Trade between India and

Australia: The Role of Free Trade

Agreements
Subject: Global Sourcing
Assignment 1

Guided By: Presented By:

Mr. Raghuram Smriti
Agenda

• What is Free Trade Agreement (FTA)

• Free Trade Relations between India and Australia
• The Benefits of Free Trade Agreement
• India and Australia ECTA
• Addressing Challenges and Concerns
• Exports & Imports
• Conclusion
What is Free Trade Agreements ??
A Free Trade Agreement (FTA) is a formal agreement between two or more countries
or economic entities that aims to promote and facilitate trade by reducing or
eliminating barriers to the flow of goods, services, and investments between the
involved parties.

Tariff Market Trade in Dispute Regulatory Investment Intellectual

Reduction or Access Services Resolution Cooperation Protections Property
Elimination Protection
Introduction to IND-AUS

India and Australia are two major India’s average growth rate of
economies in the Asia-Pacific 6.7% till (CAGR 2026-27)
region, with a combined population
Australia’s expected annual growth
of over 1.6 billion and a combined
rate of 2.04% (CAGR 2023-2027).
GDP of over US$ 4.5 trillion
IND-AUS ECTA
The Agreement encompasses cooperation across the entire gamut of bilateral
economic and commercial relations between the two friendly countries, and covers
areas like:

○ Trade in Services.
○ Technical Barriers to Trade (TBT).
○ Sanitary and Phytosanitary (SPS) measures.
○ Dispute Settlement, Movement of Natural Persons.
○ Telecom, Customs Procedures.
○ Pharmaceutical products, and Cooperation in other Areas.
○ Education
The Significance Free Trade Agreement
1 2
It will provide zero-duty access to
96% of India’s exports to Australia
including shipments from key sectors
such as engineering goods, gems and
jewellery, textiles, apparel and
leather.
3
It will also give about 85% of
It will boost bilateral trade in
Australia’s exports zero-duty
goods and services to USD 45-50
access to the Indian market,
billion over five years, up from
including coal, sheep meat and
around USD 27 billion, and generate
wool, and lower duty access on
over one million jobs in India,
Australian wines, almonds, lentils,
according to a government estimate.
and certain fruits.
 • Under the agreement, Indian
graduates from STEM (Science,
Technology, Engineering and
Mathematics) will be granted
extended post-study work visas.

• Australia will also set up a

programme to grant visas to
young Indians looking to pursue
working holidays in Australia.
Image Ref: https://www.drishtiias.com/daily-updates/daily-news-analysis/india-
australia-economic-cooperation-and-trade-agreement
Way Forward

Shared values, shared interests, shared geography and shared objectives are the
bedrock of deepening India-Australia ties.

Both India and Australia share a vision of a free, open, inclusive and rules-
based Indo-Pacific region and cooperative use of the seas by adherence to
international law including the United Nations Convention on the Law of the Sea
(UNCLOS).
Challenges Faced !!

1 2 3

A lack of access to credit and
finance for small and medium
enterprises (SMEs)
A high level of competition
from other countries such as
China, Bangladesh, Vietnam and
Cambodia, which have lower
production costs and higher
market shares.
A high level of consumer
awareness and demand for
sustainable and ethical
fashion, which requires
compliance with environmental
and social standards and
certifications.
India to Australia Exports

In 2021, India exported $6.54B to

Australia. The main products that India
exported to Australia are Refined Petroleum
($2.62B), Packaged medicines ($392M), and
Diamonds ($222M). During the last 26 years,
the exports of India to Australia have
increased at an annualized rate of 10.8%,
from $455M in 1995 to $6.54B in 2021.

Image Ref: https://oec.world/en/profile/bilateral-country/ind/partner/aus

Australia to India Exports

In 2021, Australia exported $20.5B to India.

The main products that Australia exported to
India were Coal Briquettes ($16.7B), Gold
($1.42B), and Copper Ore ($676M). During the
last 26 years, the exports of Australia to
India have increased at an annualized rate of
10.9%, from $1.38B in 1995 to $20.5B in 2021.
In 2009, Australia exported services to India
worth $2.67B, with Travel ($2.56B),
Transportation ($34.8M), and Other business
services ($34.8M) being the largest in terms of
value.

Image Ref: https://oec.world/en/profile/bilateral-country/ind/partner/aus

Trade Between Ind-Aus
Key Findings:

In 2009, Australia exported

services to India worth $2.67B,
with Travel ($2.56B),
Transportation ($34.8M), and
Other business services ($34.8M)
being the largest in terms of
value.
Trade Between Ind-Aus
Summary
Conclusion
The IND-AUS ECTA is a landmark agreement that will strengthen the economic and strategic partnership
between India and Australia. The agreement will provide significant benefits for both countries in the
apparel sector, which is one of the largest and most dynamic sectors in the world. The agreement will also
create challenges and opportunities for both countries to overcome and leverage, respectively. With its
vast pool of skilled labour, rich textile and garment-making history, and growing consumer market, India is
poised to become a global leader in the apparel industry. With its high-quality raw materials, advanced
technology, and innovative design capabilities, Australia is poised to become a global leader in the
apparel industry. Together, India and Australia can create a win-win situation for both countries and the
world.
References
● Barone, A. (2022). Free Trade Agreement (FTA) Definition: How It Works, With Example. Investopedia.

https://www.investopedia.com/terms/f/free-trade.asp

● Australia-India Economic Cooperation and Trade Agreement (AI-ECTA) | Austrade. (n.d.).

https://www.austrade.gov.au/en/how-we-can-help-you/australian exporters/free-trade-agreements/india.html

● Exploring India Australia Trade and Economic Relations | IBEF. (n.d.). India Brand Equity Foundation.

https://www.ibef.org/indian-exports/india-australia-trade

● India Australia Economic Cooperation and Trade Agreement: A Win-Win for India and Australia. (n.d.).

https://pib.gov.in/PressReleasePage.aspx?PRID=1889525#:~:text=Current%20trade%20trends%20between%20India,amount%

20to%2010.5%20US%20%24%20billion.

● India (IND) and Australia (AUS) trade | OEC. (n.d.). OEC - the Observatory of Economic Complexity.

https://oec.world/en/profile/bilateral-country/ind/partner/aus

·
References
● India-Australia Economic Cooperation and Trade Agreement. (n.d.). Drishti IAS. https://www.drishtiias.com/daily-

updates/daily-news-analysis/india-australia-economic-cooperation-and-trade-agreement

● Pti. (2022, April 2). India-Australia trade pact: Thousands of Indian goods to get duty-free access. . . The New

Indian Express. https://www.newindianexpress.com/business/2022/apr/02/india-australia-trade-pact-thousands-of-

indian-goods-to-get-duty-free-access-2437168.html

● Seth, R. D. M. D. (2023, July 25). India-Australia trade gap narrows by 15% with FTA | Mint. Mint.

https://www.livemint.com/economy/indiaaustralia-trade-gap-narrows-by-15-with-fta-11690313334678.html

● TRADING ECONOMICS. (n.d.). India Exports to Australia - 2023 Data 2024 Forecast 1988-2022 historical.

https://tradingeconomics.com/india/exports/australia
THANK YOU