Former Ambassador and Secretary (East),
Government of India and Chair,
Australia Economic Strategy Report
Over the past few years, India and Australia have discovered many commonalities to become close partners and have built a strategic partnership based on shared values and principles in a changed geo-political scenario. The governments of both countries have recognized that there is significant potential to further expand economic engagement in a broad range of areas, many of which will blossom in the future.
The Confederation of Indian industry (CII), in collaboration with KPMG has come out with the Australia Economic Strategy Report, which has been prepared as a response to the India Economic Strategy Report 2035 released by Australia in July 2018. The report, based on independent research and inputs collected from personal interviews of the team with the Ministries, governments, academia, think tanks etc., has identified potential areas of collaborations across sectors between the two nations. The report provides detailed recommendations and implementation strategies for expanding cooperation in these areas. I was privileged to lead the CII team in collaboration with KPMG in the preparation of this report.
A relative lack of awareness about business opportunities on both sides has resulted in large untapped potential in several key areas across the board in the two countries in trade as well as investments. In particular, both countries can benefit enormously from each other by cooperating in areas such as technology, innovation, natural resources and research and development.
The report identifies a number of other key opportunity areas between Australia and India in mining, services and startups, pharmaceuticals, health care and medical technologies, education and skills, agribusiness, infrastructure, power and renewable energy, railways, gems and jewelry, automotive spare parts, and tourism. The report is far reaching and futuristic, and also highlights opportunities in emerging areas like labour intensive services, defence, sports, textiles and textile designing, digital gaming and animation, water management and commercial ferries/shipbuilding, space and education technologies – all of which are expected to gain relevance in the future.
Following the outbreak of Covid 19 pandemic there will be a rethink on global value chains, and location of manufacturing catering to the specific needs of countries. India offers Australian investors a unique opportunity for diversification and use of the Indian market as a base for increasing exports and profits. The report , therefore, focuses on investment opportunities for Australian companies in India while also identifying the opportunities for investment by Indian companies in Australia in areas like mining and resources, renewable energy and agribusiness.
The implementation strategies in the key opportunity areas, as highlighted in the report, would serve as critical action points for policymakers and governments of both countries. While the success of the strategy would depend on the interest taken by industry and governments of the two countries, the strategy, if implemented and disseminated with care and diligence would greatly enhance bilateral ties and will lead to a fostering of growth and development of closer ties between the two countries.
Confederation of Indian Industry
The India-Australia bilateral relationship goes back a long way and has undergone significant evolution over the years. Both share a lot in common, underpinned by factors such as abundant natural resources, varied social and cultural factors, free press and a common British colonial past,
The Australian Economic Strategy report put together by the Confederation of Indian Industry (CII) with contribution from KPMG, led by Ambassador Anil Wadhwa, former Secretary (East), Ministry of External Affairs, presents a way forward to enhance the trade and investment relations between the two countries.
In an evolving global scenario hit by the Covid-19 pandemic, all nations are searching for new opportunities, including India and Australia. Although CII commenced on this report well before the onset of the contagion and some of the data and projections may undergo changes in the short to medium term, we believe that its larger findings are even more relevant in the current context and present a sound basis for expanding bilateral economic relations.
Both our countries face a common set of challenges, and the complementarity of resources, makes Australia a strategic partner for India to collaborate with. There is significant room to expand bilateral trade between the two countries, with many opportunities for India to expand its goods and services exports to Australia.
With its large demographic dividend, characterized by a higher share of the working age population, the Indian economy is expected to grow manifold in the future, leading to increased competition for its limited economic and natural resources. Australia, endowed with abundant natural resources, therefore could become a strategic partner for India’s resource security agenda. The report highlights strategies that can help India secure and manage its resources in an effective manner.
With its strong focus on ease of doing business and developing its manufacturing sector through flagship programs such as Make in India, India is also open to investments and collaborations in areas such as mining, healthcare, pharmaceuticals, IT, defence, etc. The report looks at opportunities across these sectors and certain emerging areas such as labour intensive services, sports, textiles, space collaborations and education technologies.
The report also presents diverse implementation strategies across sectors as action points for Governments of the two countries, to realize potential opportunities in areas such as investing in existing mines, streamlining visa processes, addressing taxation concerns, among others.
Cumulatively all these factors will help strengthen the ties between the two countries, which in turn will greatly enhance India’s growth prospects as well. CII looks forward to the unfolding agenda of cooperation with Australia and being actively engaged in achieving its potential.