India’s Economic Cooperation and Trade Agreement (ECTA) with Australia integrate both strategic and economic benefits. Elaborate (200 Words)
Refer - Business Line
Enrich the answer from other sources, if the question demands.
IAS Parliament 4 years
KEY POINTS
· The best part about India’s Economic Cooperation and Trade Agreement (ECTA) with Australia is that it bundles together both strategic and economic benefits.
· India’s semi-conductor and electric vehicles push could do with reliable supplies of rare minerals. According to industry assessments, Australia accounts for over a third of India’s coal imports, on which a duty of 2.5 per cent is levied.
· This is likely to be reduced to zero, opening up sourcing options for cement and steel producers. India’s infrastructure building plans could stabilise in the wake of the ECTA.
· The negotiators from both sides deserve appreciation for being pragmatic in leaving the difficult issue of dairy exports from Australia for inclusion at a later date and closing the deal, even if it’s an abridged one.
· India, too, is trying to create a new manufacturing ecosystem, built on a measure of tariff protection and local sourcing.
· A trade deal with Australia holds out promise because the two economies have complementary strengths and few overlaps.
· This is unlike countries such as Bangladesh, China or Vietnam. If Australia is a major mineral and agri exporter, India specialises in refined petroleum, jewellery, chemicals and garments.
· However, India will have to concede opening up of government procurement, which amounts to over 20 per cent of GDP or $500 billion, as it has done so with respect to UAE.
