India-US India talks on a limited trade deal, started under the Trump administration, are yet to begin under the Biden administration. Australia has abundant reserves of critical minerals like cobalt and lithium that go into the manufacturing of batteries for electric vehicles

NEW DELHI: As India looks at trade pacts with the UK and the European Union (EU), New Delhi could consider a similar pact with Quad partners Australia and the US, say analysts. The Quad refers to the Quadrilateral Security Dialogue among India, US, Japan and Australia.

Earlier this month, India and the UK announced their intention to look at an Enhanced Trade Partnership that sets the goal of doubling trade by 2030 and paving the way for a future UK-India Free Trade Agreement (FTA). This was seen as one of the key takeaways from the India-UK summit held between Prime Minister Narendra Modi and his UK counterpart Boris Johnson on 4 May.

And on 8 May, after the India-European Leaders’ Summit, India and EU announced that they would resume FTA talks after a gap of eight years.

The two developments follow India walking out of the Regional Comprehensive Economic Partnership (RCEP) in 2019. The RCEP is an FTA among Australia, Brunei, Cambodia, China, Indonesia, Japan, Laos, Malaysia, Myanmar, New Zealand, the Philippines, Singapore, South Korea, Thailand, and Vietnam.

“After we walked out of the RCEP, it appeared as if India was withdrawing from such global processes," said Biswajit Dhar, a professor of international trade at the New Delhi-based Jawaharlal Nehru University. “The big message that India is trying to give (by announcing its intention to start trade talks with the UK and EU) is that India is not going into a shell," Dhar said. “I think in terms of repositioning itself in the global space, India may like to look at an FTA with Australia. Australia is a natural partner, also within the Quad," he said. “The government may also look at a (trade) deal with the US, extending the Quad alliance into this economic space," he said.

India and the US had been looking at a limited trade deal during the Trump administration that was to encompass 50 to 100 goods and services, but both sides were unable to clinch it. Talks with the new Biden administration are yet to begin.

Anil Wadhwa, former Secretary East in the Indian foreign ministry and one of those behind India’s Australia Economic Strategy that was released in December said that an FTA with Australia “is important because potentially, there is an expansion of exports (to Australia) and an attracting of investments."

“It will provide enhanced market access for Indian products," Wadhwa said.

The Australia Economic Strategy notes that Australia “is an ideal strategic partner for India in its journey to achieve a transformative and inclusive economic growth."

“It is the complementarity of the resources available and the approach in dealing with these challenges that makes Australia the right partner for India to collaborate with. Further, the ‘Make in India’ initiative, launched in September 2014, covers sectors in which India is open to investments and collaborations. These include mining, healthcare and pharmaceuticals, IT, infrastructure, defence, space, tourism, etc.," the strategy says.

The report identifies mining, technology and resources, pharmaceuticals, healthcare and education as areas where the two countries could work together. A case in point: Australia has abundant reserves of Australia critical minerals like cobalt and lithium that go into the manufacturing of batteries for electric vehicles. “Through a direct or joint investment, India can secure access to Australia’s deposits, while Australia can secure an import partner," the strategy says.

Besides renewable energy, gems and jewellery, infrastructure and tourism, the strategy also says the potential of new and emerging areas like labour intensive services, defence, sports, textiles and digital gaming should also be explored by India and Australia for future collaboration.