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India, Australia negotiations on interim FTA speed up as Dec deadline approaches

The Hindu Businessline - 12 November 2021

India, Australia negotiations on interim FTA speed up as Dec deadline approaches
By Amiti Sen

Officials engaged in hectic exchange of lists of offers to arrive at a deal, say sources
India and Australia are on track so far for signing an interim free trade agreement (FTA) next month with officials from both sides engaged in exchanging lists of demands and offers in the goods, services and investments sectors, a source has said.

“India is trying to get concessions on as many goods as possible in the interim agreement that in all likelihood will be signed next month. The focus is largely on areas where Indian businesses face tariffs and other barriers such as textiles, readymade garments automobiles and pharmaceuticals,” the source said.

Commerce Minister Piyush Goyal and his Australian counterpart Dan Tehan, in a meeting in New Delhi on September 30, set a target for concluding bilateral FTA talks by end of 2022 and have in place an interim agreement, also called early harvest package, by Christmas this year.

“After discussions between officials, both sides agreed that the interim agreement could include limited commitments in a number of areas such as goods, services, investment, government procurement, rules of origin, energy and standards,” the source said.

Intense discussions are on between officials from the two sides to give a final share to the interim package so that it is ready to be signed next month.

New Delhi is also trying to look for liberalisation in norms for visas for skilled workers. “We are hoping that we could work out something quickly for skilled workers movement for inclusion in the early harvest package,” the source said.

Australia wants India to trim or eliminate duties on a wide range of goods, including agriculture and dairy products, but New Delhi is treading carefully in the area. “We understand that we have to give concessions in some items in the area of agriculture but these have to be the ones where our local producers do not have a substantial interest. Larger market access could be granted in premium products,” the source added.

The Australian Minister had indicated that his country would want lower duties in wines and spirits too, but India may not want to give substantial commitments at least for the early harvest.

India was Australia’s seventh-largest trading partner and sixth-largest export market in 2020, driven by coal and international education, according to the Australian government. Bilateral trade in 2020-21 was at $12.29 billion.

India and Australia had started talks on a CECA in 2011, but the negotiations stopped in 2015. This was due to some disagreements between the two sides in areas such as market access for agriculture in India for Australian exports as well as more liberal visa rules in Australia for Indian professionals. Another reason for the stalling of bilateral talks was that the two sides also got engaged in the negotiations for the ambitious Regional Comprehensive Economic Partnership pact, that India subsequently exited.

 source: The Hindu Businessline