World Trade Organization
WTO Trade Policy Review of India 2021 - Australia Statement
6 and 8 January 2021
India is a key economic and strategic partner for Australia. The June 2020 decision by Prime Ministers Morrison and Modi to elevate the bilateral relationship to a Comprehensive Strategic Partnership underscores our mutual commitment to enhancing engagement across all spheres, including trade and investment.
Australia recognises India’s achievement in undertaking significant reforms and lifting its ranking in the World Bank’s Ease of Doing Business rankings from 142 to 63 in just six years. India’s ongoing transformation has had a head-turning effect on Australian investors and businesses. Australia is closely following India’s ambitious reform program and looks forward to further liberalisation measures which enhance India’s trade competitiveness and attractiveness to international investors. As these reforms evolve, Australia hopes to see these changes being reflected in India’s engagement at the WTO.
Australia remains concerned about India’s agricultural policy and trade policy settings, particularly those that distort trade and production – making global markets less predictable and more unstable. Australia encourages India to use its reform program to ensure its agricultural policy and trade settings facilitate a thriving and market-based global trading system that supports the livelihoods of all Members’ populations. As one of the world’s largest producers and markets for agricultural products, what India does matters.
Australia and other Members have raised concerns about policies and measures employed by India during India’s previous trade policy reviews, and we regret to see they have continued during the review period. India maintained significant levels of production-distorting domestic support for key agricultural crops, and continued to incentivise exports of subsidised products. India's domestic support for sugarcane and its export subsidies for sugar are of particular concern to Australia, which is why Australia has joined Brazil and Guatemala in initiating a dispute to challenge those measures. In the interests of all Members, including developing country Members, Australia urges India to ensure its agricultural measures are fair, predictable and conform with India’s WTO obligations, including by providing complete and more detailed notifications. Improved notifications from India would help ensure measures supporting its agricultural sector are transparent and alleviate some of the immediate impacts on global trade and production, particularly when implemented at short notice.
In keeping with its regional and global prominence, India plays a major role in the WTO. Australia and India share a commitment to the rules-based multilateral trading system, and to maintaining the WTO’s centrality in that system. A number of difficult and systemic issues confront all Members at this time. We recognise the important role India can play as we pursue effective and meaningful reforms in areas such as levelling the playing field, special and differential treatment and the dispute settlement system. Australia calls on India therefore to play a leadership role in encouraging constructive engagement in negotiations on agriculture to help achieve an outcome at the 12th Ministerial Conference. As a major player in global services trade and a leader in e-commerce, participation by India in the joint statement initiatives on e-commerce and services domestic regulation would be strongly in India’s interests.
Total two-way trade between Australia and India climbed to $29.3 billion in 2019. In view of this remarkable growth, Prime Ministers Morrison and Modi have agreed to re-engage on a bilateral Comprehensive Economic Cooperation Agreement where a mutually agreed way forward might be found, while suitably considering earlier bilateral discussions. The door also remains open for India to re-join the Regional Comprehensive Economic Partnership at any time following the entry into force of the Agreement.
India and Australia have both been impacted by the global economic downturn precipitated by COVID-19. Expanding economic linkages and enhancing the resilience of supply chains will be key as we seek to strengthen our economies in the recovery phase. The December 2020 report to the Indian Government by the Confederation of Indian Industries – Australia Economic Strategy – along with the 2018 independent report to the Australian Government – An India Economic Strategy to 2035 – provide practical advice on ways we can achieve this goal.
Australia looks forward to continuing to work with India to strengthen the rules-based multilateral trading system and realise the potential for increased bilateral trade and investment growth.