Omari Gates
India and Australia have a strong economic relationship that has been growing significantly in recent years. In 2022, India exported goods worth $7.66 billion to Australia, an 11% increase from 1995. The main exports from India to Australia include mineral fuels, mineral oils, and products of their distillation; bituminous substances; mineral waxes; natural and precious pearls; and pharmaceutical products. India's exports to Australia also include textiles and apparel, gems and jewellery, leather goods, tea, and agricultural products. The Free Trade Agreement (FTA) between the two countries, which came into effect in December 2022, is expected to boost bilateral trade in goods and services to over US$ 70 billion in the next five years.
| Characteristics | Values |
|---|---|
| India's rank as an export partner to Australia | 6th largest export partner as of 2020 |
| Australia's rank as an export partner to India | 13th largest trading partner; 9th largest in FY23 |
| Major exports from India to Australia | Mineral fuels, mineral oils, and products of their distillation; bituminous substances; mineral waxes; natural and precious pearls; pharmaceutical products; petroleum products; engineering goods; drugs and pharmaceuticals; RMG cotton including accessories; gems and jewellery |
| Value of exports from India to Australia | US$ 7.94 billion in FY24; US$ 4.92 million from April-October FY25; US$ 3.81 billion (petroleum products); US$ 1.42 billion (engineering goods); US$ 454.36 million (drugs and pharmaceuticals); US$ 321.06 million (RMG cotton including accessories); US$ 297.01 million (gems and jewellery) |
| Number of commodities exported from India to Australia | 5,124 in FY24 |
| Value of imports from Australia to India | US$ 16.15 billion in FY24; US$ 8.41 billion during April-October FY25; US$ 4.60 billion (mineral fuels, mineral oils and products of their distillation; bituminous substances; mineral waxes); US$ 1.64 billion (natural and precious pearls) |
| Number of commodities imported from Australia to India | 1,722 in FY24 |
| Status of trade agreement between India and Australia | The Economic Cooperation and Trade Agreement (ECTA) came into effect on December 29, 2022, aiming to boost bilateral trade and reduce tariffs |
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What You'll Learn
Coal, copper, gold and other ores
Australia exports a significant amount of coal, copper, gold, and other ores to India. Let's explore each of these in detail:
Coal
Australia has been a key supplier of thermal coal to India. In April 2021, Australia exported a record-high volume of 15.24 million tonnes of thermal coal to India, according to the Australian Bureau of Statistics (ABS). This increase was partly due to Beijing's ban on Australian coal imports, which led to Australia diversifying its coal exports to other markets, including India. The average export price of Australian thermal coal was around $73.07 per tonne in April 2021, reflecting a steady increase from previous months.
Copper
India is a major player in the global copper scrap industry, both as a buyer and a supplier. However, due to limited domestic resources and growing demand, India relies significantly on copper imports. In 2023, India imported a total of 306,700 metric tonnes of copper scrap, with the United States, UAE, and Germany being the top exporters. The increasing demand for copper in India is attributed to the renewable energy and electric car industries.
Gold
India is the world's leading exporter of gold, and Australia is a significant importer of Indian gold. Between October 2023 and September 2024, India's gold exports to Australia exhibited an 8% growth rate. This growth continued in September 2024, with a year-on-year increase of 32%. India's gold industry consists of numerous manufacturers, exporters, and importers, ensuring a steady supply of gold to the Australian market.
Other Ores
While the focus is on coal, copper, and gold, Australia may also import other ores and minerals from India. India has a diverse mining industry, and depending on market demands and trade agreements, there could be potential exports of other ores to Australia.
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Petroleum products
India and Australia have a strong trading relationship, with India being Australia's seventh-largest trading partner and fifth-largest export market. In 2021, Australia exported $19.3 billion worth of goods to India, accounting for 4.2% of Australia's total exports.
The Australia-India Economic Cooperation and Trade Agreement (ECTA), which came into effect in December 2022, has further strengthened this relationship. ECTA provides preferential market access and eliminates or reduces tariffs, making Australian goods more competitive in the Indian market.
One of the key Australian exports to India is petroleum products. In 2021, Australia exported $10 billion worth of crude petroleum globally, with India being a significant importer. This trade benefits from the ECTA agreement, which provides institutional support and improved trade mechanisms between the two countries.
The petroleum trade between Australia and India is part of a broader energy partnership. Australia also exported $50 billion worth of LNG globally in 2021, although the specific volume exported to India is not publicly available. Nonetheless, LNG is an important component of the energy trade between the two countries.
In addition to crude petroleum and LNG, Australia also exports petroleum-related products to India. This includes mineral fuels, mineral oils, and products of their distillation. These exports are classified as "mineral fuels" in trade data and are significant in value. In FY25 (April-October), India imported $4.60 billion worth of mineral fuels from Australia, making it one of the largest import categories.
The petroleum products trade between Australia and India is, therefore, a significant component of their bilateral trade relationship. It involves the export of crude petroleum, LNG, and related products such as mineral fuels and mineral oils. The ECTA agreement further strengthens this trade by providing institutional support and improved market access, reducing tariffs, and streamlining documentation requirements.
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Wine, seafood and meat
Wine, seafood, and meat are among the many goods and services that Australia exports to India as part of the two countries' growing economic relationship. In recent years, trade between the two nations has been valued at around 20 billion Australian dollars, with India serving as Australia's sixth-largest export partner and 11th-largest import partner as of 2020.
The Free Trade Agreement (FTA), also known as the Economic Cooperation and Trade Agreement (ECTA), between India and Australia came into effect on December 29, 2022. The FTA is expected to bolster trade ties and boost bilateral trade in goods and services to over US$ 70 billion in the next five years.
Australia is known for its diverse range of exports, including agricultural products, minerals, metals, textiles, and pharmaceuticals. Indian consumers and businesses have a strong demand for quality Australian products, and the country's strategic location in the Indo-Pacific region makes it an attractive market for Australian exporters.
While specific data on the export of Australian wine, seafood, and meat to India is limited, it is clear that these products align with Australia's export capabilities and India's import needs. Australia is known for its high-quality agricultural products, and its meat and seafood industries are well-developed, making them likely candidates for export to India.
Additionally, Australia's wine industry is renowned, and with India's growing economy and increasing demand for diverse products, Australian wines could find a lucrative market among Indian consumers. The ECTA agreement between the two countries reduces tariffs and increases market access, making it easier for Australian exporters to enter the Indian market and meet the demands of Indian consumers, including those seeking Australian wine, seafood, and meat products.
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Cotton, hides and skins
The Australia-India Economic Cooperation and Trade Agreement (ECTA) has been in place since December 2022, with the aim of boosting bilateral trade in goods and services. This agreement has eliminated tariffs on over 90% of Australia's goods exports to India, with a value of almost $12.6 billion in 2018-2019.
One of the key outcomes of ECTA for Australia is the immediate duty-free access for cotton exports within a quota of 300,000 bales per year. In 2021, Australia exported $1.9 billion worth of cotton globally.
Hides and skins are another important Australian export to India. The ECTA agreement locked tariffs at 0% for raw and processed hides and skins from 29 December 2022 onwards. In 2021, Australia exported $648 million worth of hides and skins globally.
These exports of cotton, hides, and skins are significant for the Australian economy, and the ECTA agreement has provided a boost to these industries by reducing barriers to trade with India.
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Pharmaceuticals and pearls
Pharmaceuticals
The Indian pharmaceutical industry is known for its affordable prices and high quality, leading to the country being referred to as the "Pharmacy of the World." India is a major exporter of drug formulations and biologicals, which contribute to about 75% of the country's total pharmaceutical exports. The country's pharmaceutical exports are primarily made up of formulations and biologics (78.94%) and drug intermediates and bulk drugs (16.21%). India exports pharmaceutical products to highly regulated markets in North America, Europe, Africa, Asia, and other regions. The country is also the biggest vaccine exporter, supplying about 65-70% of the World Health Organization's (WHO) vaccine requirements.
The Indian government has implemented various schemes to strengthen and promote the pharmaceutical industry, such as the Pharmaceutical Promotion and Development Scheme (PPDS) and the Pharmaceutical Technology Upgradation Assistance Scheme (PTUAS).
Pearls
India has a high demand for pearls, both for jewellery and gifting purposes. The price of a pearl is determined by its lustre, colour, shape, size, and nacre thickness, with rounder and larger pearls generally being more valuable. South Sea pearls, cultivated in Australia, are highly priced due to their larger size. While India does not produce pearls, it is one of the top exporters of pearls, with exports going to over 194-223 countries, including the United States, Austria, and the United Arab Emirates. Hong Kong is also a significant player in the pearl trade, as pearl farmers from various countries, including China, sell their produce through auctions in Hong Kong to achieve better prices.
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Frequently asked questions
Some of the main products exported from India to Australia include mineral fuels, mineral oils, and products of their distillation; bituminous substances; mineral waxes; natural and precious pearls; and pharmaceutical products.
India's exports to Australia reached $7.94 billion in FY24.
Some of the agricultural products exported from India to Australia include rice, bread and pastry, coffee, and tea.
The trading relationship between India and Australia has been growing in recent years. The two countries signed the Economic Cooperation and Trade Agreement (ECTA) in December 2022, which will help boost bilateral trade in goods and services.
