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The utilisation rate of the India-Australia trade pact is estimated at an average of 90 per cent during the first six-months since implementation of the interim trade deal, even as exports, in terms of value, witnessed 25 per cent year-on-year (YoY) contraction during the same time period.
According to initial estimates compiled and analysed by the department of commerce, most of the labour-intensive sectors that received immediate duty concessions — from 5 per cent to zero duty — have been utilising the duty-free access while exporting goods to Australia.
The key beneficiaries of the duty concessions include exporters of items such as readymade garments, engineering products such as electrical transmission lines and marine products, people aware of the matter said.
As much as 51 per cent of the nearly 6,500 tariff lines in Australia were already attracting zero import duty.
Duty for the remaining 49 per cent — 3,185 tariff lines — were brought down to zero, as part of the trade deal.
Out of the 3,185 tariff lines, for 113, duty elimination will take place in five years. The phasing out to zero duty on the 113 tariff lines has already started.
“In case of other FTAs (free-trade agreements), the utilisation rate has been 50-60 per cent. However, in the case of Australia, the average utilisation rate is 90 per cent,” the person said.
During the January-June period, exports to Australia contracted to a fourth to $3.65 billion.
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