Former PM Tony Abbott was instrumental in getting trade talks going again
INTO INDIA believes the two big issues facing Australia are allowing greater people movement from India to Australia, and directing more of our massive A$ 2.3 trillion pension fund sector that could be a regular source of investments in the Indian infrastructure and disinvestment story.
The key for Australia is to see India as more than a “quick sale” – Indian negotiators will be looking to push the two countries to become partners, adopting policies that streamline physical movement, including, on-arrival visas, multiple entry long term business visas, etc.
From India’s perspective, it will want to ensure that trade deficits in the post agreement period do not widen. And two, non-tariff barriers and differences in standards or recognition of qualifications do not offset higher access through the trade deal. As an Indian report recently wrote: “This is the crux of the matter.”
In the larger CECA agreement, investments from Australia will play a big role in the growth of bilateral trade between the two countries, because the growth trajectory of India will create new opportunities for Australian companies, including in areas like water management and up in future, for which Australia can be a long term reliable supplier.
In the early harvest agreement, Australia wants services included with goods – an area where India has not performed well in earlier trade deals such as with ASEAN.
Australia however just needs to accept the sensitivity of the agribusiness sector in India – the deal will fall over if Australia demands substantially lower tariffs across the board for fruits, dairy, agriculture and processed food items.
INTO INDIA RECOMMENDS Australia narrow its ambitions down to selected niche items in the agriculture sector. Finding ways that Australian expertise, technology innovation and scale can actually transform Indian agriculture sector towards value addition would give Australia a big advantage.
Finally, you can expect India could show flexibility in tariff lines related to commodities and minerals, which are needed for its growing economy and the e-mobility program. In turn, Australia could be accommodative in tariff lines related to refined petroleum, medicaments, railway vehicles, gems and jewellery, auto components and made up textile items, which it imports in any case from countries around the world, in addition to India.
Thanks to Confederation of Indian Industry (CII), in collaboration with KPMG and led by Amb Anil Wadhwa, who is Former Secretary (East), Ministry of External Affairs, Government of India.