NEW DELHI: India and Australia are working to reach a free trade agreement “very soon,” as the two countries on Monday expressed commitments to further bilateral relations and to focus on the Indo-Pacific region during a virtual summit between their leaders.
India and Australia established a comprehensive strategic partnership in June 2020 and are working to boost cooperation through a free trade agreement.
Indian Prime Minister Narendra Modi and his Australian counterpart Scott Morrison said during their opening remarks that the two countries have made “great progress” on this matter.
“I am very sure that we will reach an agreement very soon on the remaining issues as well,” Modi said.
“The quick conclusion of (the Comprehensive Economic Cooperation Agreement) is important for our economic ties, economic revival and economic security.”
Morrison said the two countries will “redouble efforts” on the upcoming agreement “to unlock new opportunities and benefits for both our economies.”
India-Australia bilateral trade was worth an estimated $12 billion in 2021, and both countries have been seeking to diversify trade to cut their economic dependence on China, which is Australia’s top trading partner and India’s main source of imports.
Navdeep Suri, former Indian high commissioner to Australia, said relations between the two countries have been driven by their shared perspectives on China.
Having suffered trade friction with the Asian economic powerhouse, the situation “creates fertile ground for middle-level powers like Australia and India to come together,” Suri told Arab News.
“China is an elephant in the room for both India and Australia.”
Australia also announced a landmark investment plan in India during the summit, with programs ranging from a $13.2 million skills package, an agreement to work together on critical minerals, a $18.6 million package on space cooperation, and a $26.4 million “green steel” partnership, according to the Australian Associated Press.
The two countries are expected to sign more agreements later this month, with the total package likely to reach more than $200 million.
“The agreement on critical minerals, and given India’s focus on electric vehicles and mobility and Australia’s willingness to supply lithium to India, fits very well into our plan to emerge as a $5 trillion economy,” Suri added.
Australia accounts for 55 percent of global lithium production, and has over 20 percent of global lithium deposits. Lithium is a key active material in the rechargeable batteries that run electric cars.
Modi and Morrison also agreed to focus on the Indo-Pacific region, and briefly touched on the Russian invasion of Ukraine during their meeting.
India, which is part of the Quad grouping with Australia, the US, and Japan, has taken a neutral stance on the war in Europe, a position that Morrison had expressed “understanding” towards, Indian Foreign Secretary Harsh Vardhan Shringla said.
