Australian prime minister Tony Abbott on Friday said that negotiations for the proposed free trade agreement between India and Australia is expected to be concluded by 2016.
The agreement will help increase bilateral trade between the two countries and ensure the availability of cheaper coal to power Indian houses.
“Both India and Australia want to boost two way trade and investment and I hope that the comprehensive economic partnership — or free trade — negotiations between our two countries will be concluded, at the latest, by the end of 2016,” Abbott said while addressing a clutch of prominent businessmen from both nations in Delhi. “That way, top-quality Australian coal, for instance, will be available to power Indian households and businesses at the lowest price to consumers.”
The talks for a comprehensive economic cooperation agreement (CECA) — also known as free trade agreement (FTA) — between India and Australia were started in 2011.
So far several rounds of negotiations have been completed for further liberalising and broadening the base of merchandise trade, removing non-tariff barriers and encouraging investments. Once implemented, the FTA is expected to result in a quantum jump in bilateral trade between the two nations, which in 2012-13 stood at just $ 15 billion (2012-13). In contrast, bilateral trade between Australia and China is almost 10 times more at $ 150 billion a year.
“Two-way trade between Australia and India was only $15 billion and Indian investment in Australia is well under $20 billion and the less said about Australian investment in India the better,” Abbott added. “Trade and investment is substantial but it’s not what it should be given our countries’ level of comfort with each other, our comparative proximity and the complementarity between our economies”
In the past year, Abbott said steps have been taken to make Australia a better place to invest. Carbon and mining tax has been scrapped, a one stop shop approvals for environmental permits is being worked on while new projects worth $800 billion have been given environmental permits.
“As countries that believe in private sector-led growth, both Australia and India will be in a position to lead-by-example at the coming Brisbane G20 leaders’ summit, in committing to policies for an extra 2% growth over the next five years,” he said.