From ECTA to CECA: India and Australia Gear Up for the Next Chapter
Bilateral trade has passed $24 billion, every Indian export now enters Australia duty-free, and both governments want much more.
Two democracies, one ocean: India and Australia are preparing to widen a trade relationship that has already doubled. Illustration: Australian Indian Times
Four years after India and Australia signed their Economic Cooperation and Trade Agreement (ECTA), the partnership between the two democracies has quietly become one of the success stories of Asian trade diplomacy, and both governments are now preparing to go much further.
The numbers tell the story. Bilateral trade reached USD 24.1 billion in 2024-25, while India’s exports to Australia have more than doubled in five years, from USD 4 billion in 2020-21 to USD 8.5 billion in 2024-25, growth of 8 per cent in the latest year alone, driven by textiles, pharmaceuticals, chemicals and agricultural products.
The access Australia granted is remarkable. Under the ECTA, Australia extended preferential access to 100 per cent of its tariff lines, covering all imports from India, with 98.3 per cent of lines made duty-free from day one and the remaining 113 lines phased out over five years.
From 1 January 2026, every Indian export enters Australia at zero duty.
India, in turn, offered preferential access on 70.3 per cent of its tariff lines, covering 90.6 per cent of trade value, facilitating imports of base metals, raw cotton, chemicals, fertilisers and pulses that feed its manufacturing sector. Total trade in the current financial year stood at USD 19.3 billion to February.
But the bigger news came in July, when Prime Minister Narendra Modi was hosted by Prime Minister Anthony Albanese in Melbourne. The two leaders agreed to fast-track negotiations on a Comprehensive Economic Cooperation Agreement (CECA), the far more ambitious pact first opened for negotiation in 2011, alongside a bilateral investment treaty and deeper cooperation on defence and critical minerals.
The summit also finalised administrative arrangements that will finally allow significant quantities of Australian uranium to flow to India for peaceful civilian use, unlocking the 2014 nuclear cooperation agreement that regulatory hurdles had kept largely dormant.
In a gesture with real technological weight, Australia agreed to commission a temporary space-tracking terminal on the Cocos (Keeling) Islands to support India’s Gaganyaan human spaceflight program, the nation’s first attempt to send astronauts into space.
For the Australian Indian community, none of this is abstract. The same week as the summit, Modi addressed a crowd of 30,000 at Marvel Stadium in Melbourne, a reminder that trade agreements now rest on foundations of family, education and business ties that the diaspora has spent decades building.
For Australia, India offers what few partners can: a market of 1.4 billion consumers, a fast-growing middle class, and rising demand for the education, agricultural produce, resources and critical minerals that Australia supplies.
Negotiators acknowledge that the CECA will be harder than the ECTA. The comprehensive deal must resolve the sticking points the 2022 agreement set aside, from services and investment access to sensitive agricultural sectors on both sides.
Yet the direction is unmistakable. Two trusted partners, with perfectly complementary economies, are choosing to bind themselves closer together, and the community links between Brisbane, Melbourne and Mumbai will ensure Australian Indians feel every step of that journey first.
