Working holiday visa for Indians in new historic trade deal

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Representational image. Photo by Sudo on Unsplash

Australia has signed a historic trade agreement with India, the Australia-India Economic Cooperation and Trade Agreement, that will further strengthen its relationship while making Australian exports to India cheaper and creating huge new opportunities for workers and businesses. Among the many opprotunities include a new access for young Indians to participate in working holidays (more below).

Tariffs will be eliminated on more than 85 per cent of Australian goods exports to India (valued at more than $12.6 billion a year), rising to almost 91 per cent (valued at $13.4 billion) over 10 years.

Australian households and businesses will also benefit, with 96 per cent of Indian goods imports entering Australia duty-free on entry into force, accordig to a joint media release from Prime Minister Scott Morrison and Minister for Trade, Tourism and Investment Dan Tehan.

India is the world’s largest democracy and the world’s fastest-growing major economy, with GDP projected to grow at nine per cent in 2021-22 and 2022-23 and 7.1 per cent in 2023-24.

In 2020, India was Australia’s seventh largest trading partner, with two-way trade valued at $24.3 billion, and sixth largest goods and services export market, valued at $16.9 billion. Our Government’s goal is to lift India into our top three export markets by 2035, and to make India the third largest destination in Asia for outward Australian investment.

The Australia-India Economic Cooperation and Trade Agreement (AI ECTA) signed on Saturday will further strengthen that relationship, the statement said.

Prime Minister Scott Morrison said the agreement would create enormous trade diversification opportunities for Australian producers and service providers bound for India, valued at up to $14.8 billion each year.

“This agreement opens a big door into the world’s fastest growing major economy for Australian farmers, manufacturers, producers and so many more,” the Prime Minister said.

“By unlocking the huge market of around 1.4 billion consumers in India, we are strengthening the economy and growing jobs right here at home.

“This is great news for lobster fishers in Tasmania, wine producers in South Australia, macadamia farmers in Queensland, critical minerals miners in Western Australia, lamb farmers from New South Wales, wool producers from Victoria and metallic ore producers from the Northern Territory.

“This agreement has been built on our strong security partnership and our joint efforts in the Quad, which has created the opportunity for our economic relationship to advance to a new level.”

Benefits of AI ECTA include:

  • Sheep meat tariffs of 30 per cent will be eliminated on entry into force, providing a boost for Australian exports that already command nearly 20 per cent of India’s market
  • Wool will have the current 2.5 per cent tariffs eliminated on entry into force, supporting Australia’s second-largest market for wool products.
  • Tariffs on wine with a minimum import price of US$5 per bottle will be reduced from 150 per cent to 100 per cent on entry into force and subsequently to 50 per cent over 10 years (based on Indian wholesale price index for wine).
  • Tariffs on wine bottles with minimum import price of US$15 will be reduced from 150 per cent to 75 per cent on entry into force and subsequently to 25 per cent over 10 years (based on Indian wholesale price index for wine).
  • Tariffs up to 30 per cent on avocados, onions, broad, kidney and adzuki beans, cherries, shelled pistachios, macadamias, cashews in-shell, blueberries, raspberries, blackberries, currants will be eliminated over seven years.
  • Tariffs on almonds, lentils, oranges, mandarins, pears, apricots and strawberries will be reduced, improving opportunities for Australia’s horticulture industry to supply India’s growing food demand.
  • The resources sector will benefit from the elimination of tariffs on entry into force for coal, alumina, metallic ores, including manganese, copper and nickel; and critical minerals including titanium and zirconium.
  • LNG tariffs will be bound at 0 per cent at entry into force.
  • Tariffs on pharmaceutical products and certain medical devices will be eliminated over five and seven years.

Minister for Trade, Tourism and Investment Dan Tehan said AI ECTA would also further strengthen the people-to-people links between our countries. India was Australia’s third largest market for services exports in 2020.

“This agreement will turbocharge our close, long-standing and highly complementary economic relationship in areas such as critical minerals, professional services, education and tourism,” Mr Tehan said.

“It will create new opportunities for jobs and businesses in both countries, while laying the foundations for a full free trade agreement.”

Both countries will facilitate the recognition of professional qualifications, licensing, and registration procedures between professional services bodies in both countries.

Australian services suppliers in 31 sectors and sub-sectors will be guaranteed to receive the best treatment accorded by India to any future free trade agreement partner, including in: higher education and adult education; business services (tax, medical and dental, architectural and urban planning; research and development; communication, construction and engineering; insurance and banking; hospital; audio-visual; and tourism and travel.

Australia will also provide new access for young Indians to participate in working holidays in Australia. Places in Australia’s Work and Holiday program will be set at 1,000 per year and Australia will have two years to implement the outcome. This is expected to contribute to both workforce requirements and to boost tourism to support our post-COVID recovery.

In a boost to our STEM and IT workforces, the length of stay for an Indian Student with a bachelor’s degree with first class honours will be extended from two to three years post study in Science, Technology, Engineering or Mathematics (STEM) and information and communications technology (ICT) sectors.

Australia and India have also agreed to undertake cooperation to promote agricultural trade as part of the agreement and will now work toward concluding an enhanced agricultural Memorandum of Understanding (MoU).

Tehan signed AI ECTA on behalf of Australia during a virtual ceremony with India’s Minister of Commerce & Industry, Consumer Affairs & Food & Public Distribution and Textiles, Piyush Goyal, attended by Prime Ministers Scott Morrison and Narendra Modi.

Saturday’s announcement builds on the Morrison Government’s $280 million investment to further grow our economic relationship and support jobs and businesses in both countries, that includes:

  • $35.7 million to support cooperation on research, production and commercialisation of clean technologies, critical minerals and energy;
  • $25.2 million to deepen space cooperation with India and
  • $28.1 million to launch a Centre for Australia-India Relations.

AI ECTA is an interim agreement and both countries continue to work towards a full Comprehensive Economic Cooperation Agreement.


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