Comprehensive Economic Cooperation Agreement (CECA)

• IAS NEXT, Lucknow
• 14, Feb 2022

Reference News:-

The interim trade agreement between India and Australia is unlikely to include items that both sides consider “sensitive”.

• The Indian and Australian negotiators will have the final “interim agreement” ready in 30 days and that the agreement will be a “win-win” document.

Background:

Both sides expressed confidence about signing a comprehensive Free Trade Agreement — CECA — and argued that the “interim agreement” is an “early harvest deal” aimed at boosting bilateral trade before the completion of the negotiations on the final CECA.

India- Australia bilateral trade:

• India’s exports to Australia amounted to $4.04 billion while imports were $8.24 billion in FY21.
• Major Indian exports to Australia are petroleum products, medicines, polished diamonds, gold jewellery, apparel etc, while key Australian exports to India include coal, LNG, alumina and non-monetary gold.
• In services, major Indian exports include travel, telecom and computer, government and financial services, while Australian services exports were principally in education and personal travel.
• In 2020, India was Australia’s seventh-largest trading partner and sixth largest export destination, driven by coal and international education.

Significance of the deal for India:

The interim agreement will mark the beginning of a phase of FTAs that India is aiming to achieve in the coming year.

• Apart from Australia, India is in talks to conclude similar FTAs and early harvest deals with Israel, Canada, the European Union and the United Arab Emirates.
• The Gulf Cooperation Council – the six country block – has also shown interest in concluding an FTA with India. The GCC includes Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and also the UAE