India, Australia upgrade ties, to renew talks on CECA

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Published: June 5, 2020 3:15 AM

India and Australia can now share the benefits of scientific and medical research and development and open up a new phase of the Australia-India Strategic Research Fund to promote innovative solutions for responding to and treating Covid.

On the trade and investment fronts, India and Australia have agreed to encourage expanded flows and re-engage on a bilateral comprehensive economic cooperation agreementOn the trade and investment fronts, India and Australia have agreed to encourage expanded flows and re-engage on a bilateral comprehensive economic cooperation agreement

India and Australia have decided to take their ties to the level of a comprehensive strategic partnership with nine key agreements, including deepening trade exchanges, diversifying energy cooperation to areas such as hydrogen and coal gasification and exploring the possibility of launching the RuPay Card in Australia.

However, there has been no headway in the issue of market access in agriculture, with both sides sticking to a commitment to continue negotiations.

The upgradation in the ties, announced at the first India-Australia Leaders’ Virtual Summit attended by Prime Minister Narendra Modi and Prime Minister of Australia Scott Morrison on Thursday, is significant as both the countries are looking at expanding trade and economic ties as well as collaboration on building a globally-coordinated response to Covid.

India and Australia can now share the benefits of scientific and medical research and development and open up a new phase of the Australia-India Strategic Research Fund to promote innovative solutions for responding to and treating Covid.

On the trade and investment fronts, India and Australia have agreed to encourage expanded flows and re-engage on a bilateral comprehensive economic cooperation agreement, negotiations for which were launched in May 2011. Till date, they have had nine rounds of negotiations, with the last being in September 2015.

Bilateral trade was at $20.92 in FY19, with Indian export of goods and services at $5.17 billion and import at $15.75 billion. Australia’s cumulative investment in India is about $10.74 billion, whereas India’s total investment in Australia is $10.45 billion. To diversify bilateral trade, India and Australia will explore how major industries of both the countries can integrate SME/MSMEs of the other country into their supply chains.

To boost investment, both sides will work to resolve the issue of taxation of offshore income of Indian firms through the India-Australia Double Taxation Avoidance Agreement. Australian Pension Fund has already invested $1 billion in India’s National Investment and Infrastructure Fund. The countries will raise awareness among Australian investors and superannuation funds of opportunities in India’s infrastructure sector under the NIIF.

While Australian businesses will be made aware of opportunities through Make in India and Smart Cities initiatives, Indian companies will seek investment opportunities in Australia.

Advancements have also been made in the fields of agriculture and mining and processing of critical and strategic minerals.

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