Local business celebrates the new interim Australia-India free trade agreement

Business groups have welcomed the development of an interim Australia-India free trade agreement, an economic pledge which promises to slash tariffs and make it easier for qualified professionals to live and work in each country.

On Saturday, Prime Minister Scott Morrison and Trade Minister Dan Tehan announced the signing of the Australia-India Economic Cooperation and Trade Agreement, (AI-ECTA) a pact designed to strengthen ties between both nations.

The agreement will initially cut tariffs on 85% of Australian exports, worth $12.6 billion a year, Morrison and Tehan said. The scheme will expand over the course of a decade, eventually cutting tariffs on around 91% of exports, worth $13.4 billion.

Beyond the benefits for Australian exporters, the scheme also promises to benefit the professional services industry.

The agreement will “facilitate the recognition of professional qualifications, licensing, and registration procedures between professional services bodies in both countries”, according to a government statement.

The AI-ECTA arrives at a moment of significant talent shortages constraining Australian industries, including the accounting and engineering fields — both of which are flagged in the government statement.

“Enhanced labour mobility and fewer barriers for the services sector will help create and strengthen the industries Australia needs for the future, including professional services, the digital economy, education and energy and resources,” said Business Council chief executive Jennifer Westacott.

The deal will also see Australia business “benefit from diversified global supply chains” and “gives Australian exporters preferential access to a market of nearly one and a half billion customers,” Australian Chamber of Commerce and Industry chief executive Andrew McKellar said Saturday.

The AI-ECTA serves as a stepping stone towards a comprehensive economic cooperation agreement, Morrison and Tehan said.