Article by: Hari Yellina
The Australian dairy industry is frustrated that the interim free trade agreement with India did not result in significant dairy market access benefits. Prime Minister Scott Morrison announced the historic pact between Australia and India on Saturday, worth up to $14.8 billion per year. Tariffs on more than 85 percent of Australian commodities sent to the world’s fastest-growing major economy will be erased under the Australia-India Economic Cooperation and Trade Agreement (AI ECTA). Rick Gladigau, chair of the Australian Dairy Industry Council (ADIC), acknowledged the government’s efforts in pushing for a dairy outcome in the talks, but expressed concern that India did not acknowledge the significant benefit of partnering with Australian dairy to supplement local India dairy production and fill gaps.
Mr Gladigau stated, “The dairy industry supports the government’s goal of delivering a comprehensive trade agreement with India, a crucial economic partner.” However, any agreement, interim or otherwise, that does not include dairy market access benefits is a disappointment. It is disappointing that a significant industry like dairy is largely excluded from trade negotiations. The dairy industry’s priority will now shift to ensuring that dairy market access is prioritised in any subsequent comprehensive agreement. “While unfortunate, this temporary agreement does not mark the end of the road in terms of expanding Australia-India dairy trade connections,” Mr Gladigau said.
Over the next seven years, tariffs on avocados, onions, broad, kidney, and adzuki beans, cherries, shelled pistachios, macadamias, cashews in shell, blueberries, raspberries, blackberries, and currants will be phased out. Tariffs on almonds, lentils, oranges, mandarins, pears, apricots, and strawberries will be decreased, giving Australia’s horticultural industry more opportunity to meet India’s expanding food demand.
Wine tariffs on wine with a minimum import price of $5 per bottle will be decreased from 150 percent to 100 percent when the law takes effect, and then to 50 percent over the next ten years (based on Indian wholesale price index for wine). Tariffs on wine bottles with a minimum import price of $15 will be decreased from 150 percent to 75 percent when the law takes effect, and then to 25 percent over the next ten years (based on Indian wholesale price index for wine).
Sheepmeat tariffs of 30pc will be eliminated on entry into force, providing a boost for Australian exports that already command nearly 20pc of India’s market.