ALE with Aus by 2022; “Fruits at hand” in the interim agreement

INDIA AND Australia plan to sign a comprehensive free trade agreement (FTA) by the end of 2022, the countries said in a joint statement on Monday. Countries are expected to finalize an exchange of offers on areas in which they would like to strengthen trade by the end of October and finalize an interim agreement on certain areas by December 2021.

“What we have agreed today is to ensure that we will conclude a free trade agreement between Australia and India by the end of 2022,” said Australian Trade Minister Dan Tehan, adding that the deal would include an interim deal, which countries would seek out. to be finalized by Christmas this year.

Trade Minister Piyush Goyal said the interim agreement would cover “fruits at hand” where both sides have an interest in expanding trade and that it could be implemented even as the final agreement is under negotiation.

“It also has a great demonstration effect because businesses and people on both sides are starting to reap the benefits of the agreement and has a great demonstration effect on others to seek to be more open and broaden the contours of the deal. the trade agreement, ”he said.

Explain

The contours of the free trade agreement

The agreement between countries should include goods, services, investments, government procurement, logistics and transport standards and rules of origin within the framework on which the countries have agreed. Earlier Thursday, Australian Prime Minister Scott Morrison said Quad members (India, Australia, United States, Japan) “are deepening critical and emerging technologies, and in particular rare earths, and the supply chain of rare earths and critical minerals ”. He added that India’s manufacturing capacity, combined with Australia’s natural resources, was a “natural partnership”.

India had already launched negotiations with Australia for an FTA in May 2011, which were integrated into trade negotiations under the Regional Comprehensive Economic Partnership (RCEP) between ASEAN countries, including India, as well as Australia, China, Japan, Republic of Korea and New Zealand. Zealand. India, however, chose not to join RCEP in 2019, saying concerns were not being addressed. Goyal said Australia and India had no outstanding issues that would have contributed to the country pulling out of the deal.

Experts said Australia is likely to seek better access for its agricultural products in India, which could become a difficult political issue, while India is likely to seek greater ease of movement for Indian service professionals. export to Australia.

India is also in the process of negotiating FTAs ​​with the UK, UAE and the EU. He is also looking to conclude talks on an interim deal with the United Arab Emirates by December of this year.