The India-Australia Economic Cooperation and Trade Agreement (IndAus ECTA), signed on April 2, resolves the double taxation issue for Indian information technology (IT) firms, allows duty-free access to Indian wines and a work and holiday arrangement, a report in Mint has said.
A negotiation sub-committee between India and Australia will begin talks within 75 days to transform the interim pact into a full-fledged comprehensive economic cooperation agreement (CECA), the agreement said.
The move comes as a major relief for Indian IT firms such as Infosys, Wipro, Tata Consultancy Services, and HCL Technologies.
Also Read: India, Australia ink economic cooperation and trade pact to boost ties
Australia has committed to resolving the long-pending double taxation issue that was affecting the Indian tech companies operating in the country through amendments in its domestic law over the next few months.
The resolution of this issue will happen in line with the implementation of the bilateral economic cooperation and bilateral free trade pact between the two countries and is expected to help Indian IT companies expand their operations in Australia.
As part of the trade agreement, Australia will allow duty-free access in its market for over 95 percent of Indian goods such as textiles, leather, jewellery, and sports products.
The trade agreement was inked by Commerce and Industry Minister Piyush Goyal and Australian Minister for Trade, Tourism and Investment Dan Tehan in a virtual ceremony, in the presence of Prime Minister Narendra Modi and his Australian counterpart Scott Morrison.
The agreement will help in taking bilateral trade from $27 billion to $45-50 billion in the next five years, Goyal said.
Australia is offering zero duty access to India for about 96.4 percent of exports (by value) from Day One. This covers several products which attract 4-5 percent customs duty in Australia.
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