With China thawing, Australia looks to double trade with India

Bloomberg

Australia is eyeing India’s burgeoning middle class to help offset the economic damage wrought to some of its major exports by the twin headwinds of Covid-19 and heavy restrictions imposed by its biggest trade partner, China.
With a middle-to-high income population of about 85 million people, according to Pew Research — roughly three times Australia’s total population — it’s seen as a prime target for sectors from education to tourism, all of which were hit badly by the pandemic and worsening relations with China.
Bilateral trade is expected to more than double to around A$60 billion over the next five years, after a pact that cuts or eliminates tariffs on a number of goods and services, and gives greater recognition of professional qualifications, comes into place on December 29.
While that’s still just a sliver of Australia’s two-way trade of A$280 billion with China, India’s widely recognised as a huge piece of the country’s diversification puzzle.
Australia’s efforts are paying off, just as its relationship with China is also showing signs of thawing. Between April and October this year, India’s imports of Australian goods climbed to $12.3 billion, up 48% from a year ago.
The mood is buoyant and Ajay Sahai, director general, Federation of Indian Export Organisations expects to see a further boost in coming years.
“Coal, copper, aluminium, cobalt we can see a sizable jump in all of this,” Sahai said.
Australia, where the Indian diaspora represents about 3% of the population, established the Centre for Australia-India Relations in 2022 to promote policy dialogue and administer scholarship and fellowship programs among other things.
India and Australia are also part of a multi-year program to help Australian businesses compete in India and will this year host a leadership dialog, with Indian PM Narendra Modi likely in attendance.
Tourism is another sector in which Australia is anxious to entice India’s burgeoning middle class.