India was Australia's fifth-largest export market in 2013, but in overall trade, did not make our top 10. The $15-billion two way trade between Australian and India pales against our other trading partners. That needs to change.
Australia has much to offer and it would seem we have only just begun to appreciate the scale and size of the opportunity India presents. Likewise, Indian business has yet to truly understand the potential of Australia as a provider of food, energy and services. The key to unlocking the potential of our commercial relationship will be to focus on our strengths.
Knowing what we are good at helps realise our commitment better. Australia's competitive strengths are in energy and resources, food and agribusiness, tourism, education, medical and health. These are the things we do well and better than most. I also include all the sophisticated services that cluster around these things, such as logistics, engineering, vocational training and advanced manufacturing.
Reap the Potential
India and Australia have achieved a lot together, but not nearly as much as we could have. We need to be asking questions about why this is the case. Importantly, we need to look at where there are gaps in our understanding of each other. We also need to be more proactive in assessing the commercial opportunities and work to make it easier for business.
This week in Mumbai and New Delhi, I have met government and business leaders to do just that. With pressures on energy, food and water security, now is not the time to ponder possibilities; it is a time to act. The signing of an agreement allowing the sale of uranium to India for peaceful power generation, concluded this week, is a clear indication that Australia is prepared to commit to action. Action that will make our trade and investment relationship stronger and more comprehensive.
As part of our efforts to increase understanding between the two countries, we will hold Australia Business Week in India in January 2015, promoting increased trade, investment, education and tourism. This is an important opportunity because experience shows that when we do understand our complementarities and mutual strengths, we are successful.
Shared endeavours in resources, particularly coal, have been a highlight of our commercial relationship to date. Adani Mining's $16.5-billion commitment to a project in Queensland is a clear illustration of this. Of our $11 billion exports to India, more than half are coal and other minerals. We will continue to build on this.
Australia needs the productive investment that Indian corporates can bring. It is in other areas, particularly services, where we need broaden our approach. Australian organisations are already partnering Indian counterparts on projects that aim to address many problems that hamper economic growth. Here again, where our capability and needs align, there has been very worthwhile progress.
Road safety has long been an issue in India, the economic and social impact being estimated in excess of $50 billion annually. Australian government and commercial entities are advising regional authorities in India on strategies to improve safety and providing technology and services. Additionally, Indian and Australian organisations are collaborating in agriculture. Joint projects in dairy, fisheries and the grain sectors will benefit both countries. India needs to provide new jobs for at least 10 million people every year. Non-farm job creation in the manufacturing sector is urgently required.
Australia is ready to assist India's efforts with 'make in India' by improving manufacturing competitiveness through projects in lightweight materials, production efficiencies and reduced energy consumption. This will directly boost employment and, therefore, economic growth.
Indian students have contributed much to Australia and we look forward to maintaining this important relationship. Our vocational and training sector can help alleviate critical skill gaps for the millions of young India seeking fulfilling careers. Indian companies have been valued partners in Australia. Investments in sectors such as IT, financial services, pharma, infrastructure and agribusiness have contributed much to the Australian economy. These also represent key industry strengths for India, particularly complex technology service solutions.
The Australian government has a focus on attracting increased investment in five areas: agribusiness, tourism and major infrastructure, resources and energy and advanced manufacturing. Clearly, Indian companies are well placed to take advantage of the opportunities Australia offers, including the unrealised potential of Northern Australia. This region has the capacity to supply energy and food to India and Indo-Pacificmarkets for centuries.
My vision for Australia and India is a partnership that builds on our respective strengths, gets rid of residual barriers to trade and encourages bilateral productive investment. The Australian government will work towards this goal. I am also looking to the business communities of both countries to support that vision.
- Trade Minister's Office: (02) 6277 7420
- DFAT Media Liaison: (02) 6261 1555