India, Australia resume negotiations of Comprehensive Economic Cooperation Agreement, to sign by end of 2022
India and Australia resume negotiations of Comprehensive Economic Cooperation Agreement during the 17th India-Australia Joint Ministerial Commission. Know key highlights.
Comprehensive Economic Cooperation Agreement (CECA): India’s Minister of Commerce and Industry Piyush Goyal and Australian Minister for Trade, Tourism, and Investment Dan Tehan have formally launched the resumption of negotiations on the India-Australia Comprehensive Economic Cooperation Agreement (CECA) during the 17th India-Australia Joint Ministerial Commission on September 30, 2021. Both India and Australia reiterated their commitment to sign a CECA by the end of 2022 including reaching an interim agreement by December 2021.
17th India-Australia Joint Ministerial Commission – Key highlights
During the 17th India-Australia Joint Ministerial Commission, both ministers deliberated on key issues such as expediting negotiation of bilateral CECA, increased two-way trade, resolving tax-related issues faced by Indian software companies in Australia, and the 12th World Trade Organization (WTO) Ministerial Conference (MC12) which is scheduled to be held towards the end of 2021 in Geneva, Switzerland.
Both India and Australia reiterated their commitment to sign a CECA by the end of 2022. This includes reaching an interim agreement by December 2021 to liberalize and deepen bilateral trade in goods and services. Since 2011, India has been negotiating the CECA including investment and related issues and trade in goods and services.
The India-Australia Joint Ministerial Commission laid out the key areas that the India-Australia Free Trade Agreement (FTA) will cover in accordance with Article XXIV of the General Agreement on Tariffs and Trade. These areas include investment, goods and services, logistics and transport, energy and resources, sanitary and phytosanitary measures, rules of origin, and standards.
Both India and Australia also agreed to explore government procurement and conduct an exchange of offers by October-end 2021.
India-Australia Bilateral Trade Agreement – Significance
Both India and Australia are looking to build on the earlier bilateral negotiations between both countries. Agreeing to the need for a balanced trade agreement reflects a shared commitment of India and Australia towards the rules-based international trading system and encouraging expanded trade and investment flow to benefit both economies.
A balanced trade agreement between India and Australia is significant to strengthen the rules-based, non-discriminatory, transparent, open, and inclusive multilateral trading system as formed by the World Trade Organization. With a balanced bilateral trade agreement, both India and Australia have agreed to work towards a balanced and ambitious outcome at the 12th WTO Ministerial Conference (MC12) in Geneva, Switzerland.
India-Australia Bilateral Trade
India and Australia are key trading partners. India-Australia bilateral trade has exceeded AUD$24 billion over the past years. Major items that India exports to Australia include petroleum products, diamonds, medicines, jewellery, gold, apparels, etc while the key products that Australia exports to India include non-monetary gold, LNG, coal, and alumina.
In the services sector, major Indian exports to Australia include telecom, computer, travel, government, and financial services. Major Australian services exports include travel and education.
In 2020, India was the 7th largest trading partner and 6th largest export destination of Australia, mostly driven by international education and coal.
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