Australia, A Natural Partner for India’s Growth Trajectory

Context

• The relationship between Australia and India has entered a new era of economic and strategic cooperation, with Australia expressing strong confidence in India’s growth trajectory.
• This partnership is built on shared economic interests, strategic alignment, and historical ties.
• The recently launched New Roadmap for Australia’s Economic Engagement with India outlines how Australia aims to support and benefit from India's rapid development.

Australia’s Confidence in India’s Economic Growth

• Australia firmly believes in India's economic potential, predicting that India will become the world’s third-largest economy by 2030.
• This confidence stems from India's robust economic growth and increasing global influence.
• Recognising India’s rising stature, Australia supports India's claim for a permanent seat on the United Nations Security Council, emphasising that India's growing economic power should be reflected in global decision-making.
• Moreover, the economic complementarities between the two nations serve as a foundation for their collaboration.
• Australia possesses resources that are crucial for India’s industrial and technological advancement, while India offers a vast market for Australian goods and services.
• This interdependence makes Australia a natural partner in India’s economic journey.

Australia’s Engagement with India

• New Roadmap for Australia’s Economic Engagement with India
  • Launched by Australian Prime Minister Anthony Albanese, it is builds on the progress made since 2018.
  • It provides a strategic plan for further deepening trade and economic cooperation.
  • The impact of the Economic Cooperation and Trade Agreement (ECTA) has already been substantial, as evidenced by the rapid increase in trade between the two nations.
  • While India’s global exports have grown by 35% in the last five years, its exports to Australia have surged by 66%, indicating a strong economic synergy.
  • The roadmap identifies four key sectors, described as the ‘Superhighways of Growth,’ where India and Australia can collaborate effectively:
    • Clean Energy – Australia provides essential resources such as lithium, nickel, and cobalt, which are critical for India's electric vehicle and renewable energy sectors.
    • Education and Skills – Australian universities are expanding their presence in India, helping train the next generation of Indian professionals.
    • Agribusiness – Enhancing trade in agricultural products and food security.
    • Tourism – Promoting mutual travel and cultural exchange.
  • Additionally, seven other ‘Major Economic Roads’ for cooperation have been identified: investment, technology, sports, culture and arts, resources, defence, space, and health.
  • By focusing on these areas, the roadmap aims to solidify economic cooperation between the two nations.
• Addressing India’s Skill Development Needs
  • India faces a major challenge in skilling two crore (20 million) people annually to meet the demands of its growing economy.
  • Recognising this, Australia is positioning itself as a key partner in India's skill development initiatives.
  • Australian universities are playing a crucial role in this effort by setting up campuses in India, such as those in Gujarat International Finance Tech (GIFT) City and Noida, with more expected in the future.
  • By providing high-quality education and vocational training, Australia is helping India create a workforce equipped for its expanding industries, particularly in technology, manufacturing, and clean energy.

The Role of the Indian Diaspora in Strengthening Ties

• One of the most significant advantages of the Australia-India partnership is the Indian diaspora in Australia, which is over 1 million (10 lakh) strong and growing rapidly.
• This community acts as a cultural and economic bridge, fostering business and government ties.
• Many Indian-Australians hold leadership positions, contributing to policy-making and economic collaboration between the two countries.
• Australia recognises the potential of this ‘human bridge’ and has invested ₹22 crore in the Maitri Grants Program, which strengthens diaspora links and supports cultural and economic initiatives.
• Additionally, the Centre for Australia-India Relations has been established with a funding of ₹132 crore to enhance bilateral engagement.

The Path Ahead: Comprehensive Economic Cooperation Agreement (CECA)

• While the ECTA has significantly boosted trade, the next step in economic engagement is the CECA, which aims to further remove trade barriers and create a robust framework for long-term economic cooperation.
• With CECA, both nations can unlock new opportunities in investment, innovation, and business collaboration.

Conclusion

• Australia’s confidence in India’s economic rise is evident in its proactive approach to trade, education, energy, and skill development.
• The New Roadmap provides a clear direction for future cooperation, ensuring that both nations benefit from each other's strengths.
• As Australian Prime Minister Anthony Albanese stated, Australia’s relationship with India is stronger, deeper, and more consequential than it has ever been.
• With the right policies and initiatives in place, this partnership is set to reach new heights in the coming years.

Q1. Why does Australia support India’s claim for a seat on the UN Security Council?
Ans. Australia believes India’s growing economic power should be reflected in global decision-making.

Q2. What are the four "Superhighways of Growth" identified in the New Roadmap?
Ans. Clean energy, education and skills, agribusiness, and tourism.

Q3. How has India's trade with Australia grown compared to its global exports?
Ans. India's exports to Australia have grown by 66%, nearly twice as fast as its global exports (35%).

Q4. How is the Indian diaspora contributing to Australia-India relations?
Ans. The 1 million-strong Indian diaspora acts as a cultural and economic bridge, fostering business and government ties.

Q5. What is the next major trade agreement being pursued between India and Australia?
Ans. The Comprehensive Economic Cooperation Agreement (CECA). 

Source:The Hindu