India-Australia FTA enabled over 14% export growth in 2023-24: Piyush Goyal

The India- Australia free trade agreement has been a “landmark” pact that enabled growth in exports by over 14% in 2023-24 and increased market access for Indian exporters, commerce minister Piyush Goyal said on the second anniversary of the India-Australia Economic Cooperation and Trade Agreement (ECTA).

“This landmark agreement has brought with it increased market access for Indian exporters, expanded opportunities for MSMEs and farmers, and generated several employment avenues,” he said in a post on X. India signed an FTA with Australia on April 2, 2022 that was operationalised on December 29, 2022.

He said the agreement also gave “notable boost” in IT/ITeS, business and travel services and post-study work and work holiday visas.

“Since its signing, bilateral merchandise trade has more than doubled, surging from $12.2 billion in 2020-21 to $26 billion in 2022-23. Total trade, however, moderated in the year 2023-24 to $24 billion in 2023-24, with India’s exports to Australia growing by 14%. The current fiscal year continues to reflect strong momentum. Total merchandise bilateral trade from April-November 2024 reached $16.3 billion,” the commerce ministry said in a statement.

According to official data, India’s merchandise exports to Australia in 2022-23 was $6.95 billion, which reflected only three months of trade post operationalisation of the FTA. India’s imports from Australia in FY23 was goods worth $19 billion. In the following fiscal year (2023-24) India’s merchandise exports to Australia posted 14.23% year-on-year growth at $7.94 billion. It was the first full fiscal year after operationalisation of the FTA. Imports from Australia, however, registered about 15% contraction at $16.15 billion in the corresponding period (FY24).

“Exchange of preferential import data has commenced between both countries, highlighting the effective implementation of the agreement in 2023. The data reveals export utilization at 79% and import utilization at 84%,” the ministry said in the statement.

The India-Australia Economic Cooperation and Trade Agreement (or Ind-Aus ECTA) is showcasing the complementarity of both economies, it said. “The Ind-Aus ECTA has significantly advanced trade ties, creating new opportunities for MSMEs, businesses and employment in both nations while reinforcing the foundation of their economic partnership,” it said.

“Entering its third year, the Government of India is dedicated to sustaining this momentum through strengthened collaboration and innovative initiatives to drive mutual prosperity to realize the vision 2047 of Hon’ble Prime Minister to make India a developed country,” it added.

Key sectors like textiles, chemicals, and agriculture have shown substantial growth, while exports on new lines, including gold studded with diamonds and turbojets highlight the diversification enabled by the agreement, it said. Imports of essential raw materials, such as metalliferous ores, cotton, wood and wood products have fuelled India’s industries, contributing to the win-win nature of this partnership, it added. Sectors such as electronics and engineering have room for growth, it said.

Building upon this success, the India-Australia Comprehensive Economic Cooperation Agreement (CECA) is now in progress with 10 formal rounds and inter-sessional discussions held so far. CECA builds on the foundation laid by the ECTA, advancing the bilateral trade agenda with even greater ambition, it said. “A stocktake visit on India-Australia CECA was also recently concluded in New Delhi from 4th to 6th December 2024 to assess the progress made and chart the path forward,” it added.

“Both the parties are committed to building on the momentum created by the ECTA, driving deeper economic integration and to achieve the target of trade to reach AUD 100 billion by 2030 between India and Australia,” the statement said. Together, India and Australia are poised to take their economic partnership to new heights, fostering mutual prosperity and contributing to a more resilient and dynamic global economy, it added.