The India-Australia Economic Cooperation and Trade Agreement (ECTA), an institutional mechanism aimed at encouraging and improving trade between the two countries, came into effect on Thursday.
With this, India has achieved the unique distinction of operationalising two trade agreements this year. The India-UAE Comprehensive Economic Partnership Agreement came into force on 1 May. The ECTA was signed on 2 April and ratified on 21 November.
The two countries exchanged written notifications on 29 November. Addressing industry representatives and the media in Mumbai, Union Commerce and Industry Minister Piyush Goyal said the accord has been “negotiated with the speed of Bret Lee and the perfection of Sachin Tendulkar”.
“There is a lot of potential for exporting finished goods to Australia since they hardly manufacture anything, they are 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,” he said.
Goyal said Australia, which is largely dependent on imports, will benefit hugely. It will soon start seeing a lot more finished goods coming in from India, providing a huge amount of work and job opportunities in both goods and services.
The agreement, he said, will also eliminate Double taxation on IT services which were making Indian businesses less competitive and less profitable in the IT sector.
“I appreciate the Australian government for being very sensitive and considerate, giving us full cooperation throughout the negotiations, especially in protecting the interests of the farmers and dairy sector of India. Products like agricultural products and dairy sector – which were very sensitive for India and without which Australia has never done an agreement before – have been protected, I am hugely grateful to the Australian government for this,”Goyal added.