What Is the India-Australia ECTA and Does It Affect Buyers Sourcing from India?
If you are an Australian importer sourcing goods from India, the india australia ecta sourcing impact on your landed costs is worth understanding precisely — not in general terms. The India-Australia Economic Cooperation and Trade Agreement entered into force on 29 December 2022, marking the first bilateral trade agreement between the two countries. It is an interim agreement, not a full comprehensive FTA, which means the scope of tariff commitments and the product categories covered are more limited than a complete treaty. What it does cover, however, directly affects the duty position of Australian buyers sourcing from India across a range of significant product categories. This guide sets out what the ECTA actually does, which categories benefit, and what you need in documentation to access the preferential rates.
Quick Answer
The India-Australia ECTA, in force since December 2022, reduces or eliminates Australian customs duties on approximately 85% of Indian goods by value — covering categories including textiles, leather, gems and jewellery, processed foods, machinery, and pharmaceuticals. To access preferential rates, Australian importers need a valid Certificate of Origin issued under the ECTA by an authorised Indian body. The agreement is an interim arrangement pending a broader Comprehensive Economic Cooperation Agreement.
What the India-Australia ECTA Actually Is
The Economic Cooperation and Trade Agreement — commonly referred to as the ECTA or AI-ECTA — is a bilateral trade agreement between India and Australia that entered into force on 29 December 2022. It is formally an interim agreement, designed to deliver early tariff benefits while negotiations on a broader Comprehensive Economic Cooperation Agreement (CECA) continue between the two governments.
The distinction between an interim ECTA and a full CECA matters for importers. The ECTA covers goods trade and some services provisions but does not include the full suite of investment, intellectual property, and regulatory cooperation chapters that a comprehensive agreement would contain. For Australian buyers sourcing physical goods from India, the goods tariff schedule is the commercially relevant section — and it is substantial.
Scale of the tariff commitments
Under the ECTA, Australia committed to eliminate tariffs on approximately 85% of Indian goods by value immediately on entry into force, with a further tranche reaching 90% by the end of the phase-in period. India committed to eliminate or reduce tariffs on approximately 70% of Australian goods, with commitments phasing in over a period of up to ten years depending on the product category. The asymmetry reflects the development differential between the two economies and is a standard feature of trade agreements between developed and developing country partners.
For Australian importers, the practical effect of the 85% immediate elimination is significant: for a broad range of Indian goods that previously attracted Australia’s general tariff rate — typically 5% for most goods, with some categories higher — the applicable duty from 29 December 2022 onwards is zero, provided the goods meet the rules of origin requirements and are accompanied by the correct documentation.
Which Product Categories Benefit for Australian Importers
The tariff schedule under the ECTA covers specific HS code classifications, not broad category descriptions. The commercially significant categories for Australian buyers sourcing from India include several major trade flows.
Textiles, apparel, and made-up textile articles
Textiles and apparel represent one of the largest India-Australia trade flows and one of the most commercially significant areas of ECTA benefit. India is a major global supplier of woven and knitted fabrics, garments, made-up household textiles, and technical textiles. Australian importers in the fashion retail, workwear, and home textiles sectors who were previously paying 5% duty on Indian-origin goods — or higher rates on specific categories — moved to zero duty on entry into force for the bulk of these categories. For importers with substantial annual purchase volumes from India in this space, the duty saving is material and compounds over time.
Gems, jewellery, and precious metals
India is the world’s largest processing centre for cut and polished diamonds and a significant exporter of gold jewellery and other gem-set jewellery. The ECTA includes commitments covering gems and jewellery, a category that carries meaningful Australian import duties for some subcategories. The agreement’s provisions in this space are relevant to Australian jewellery importers and retailers sourcing finished or semi-finished pieces from Indian manufacturers and exporters.
Pharmaceuticals and health products
India is one of the world’s largest pharmaceutical exporters, supplying generic medicines and active pharmaceutical ingredients globally. The ECTA includes pharmaceutical categories, relevant to Australian importers in the healthcare distribution and pharmacy supply sectors. The interaction between ECTA tariff preferences and the Therapeutic Goods Administration (TGA) regulatory requirements for pharmaceutical imports remains a separate compliance consideration — tariff preference does not substitute for TGA market authorisation.
Processed foods and agricultural products
A range of processed food categories from India benefit from ECTA preferences. This includes certain spices, condiments, prepared food products, and processed agricultural goods. The specific categories and the applicable rates — some of which phase to zero over time rather than immediately — are defined at the HS code level in the ECTA tariff schedule. Australian food importers should verify the specific HS code of their product against the ECTA schedule maintained by the Australian Department of Foreign Affairs and Trade before assuming a preferential rate applies.
Machinery, engineering goods, and manufactured products
India’s engineering and capital goods export sector has grown substantially over the past two decades. The ECTA includes commitments covering machinery, engineering goods, and manufactured products — categories relevant to Australian industrial buyers and equipment importers. The specific coverage at HS code level varies, and some categories in this space have staged phase-in periods rather than immediate elimination.
The Certificate of Origin Requirement — How It Works in Practice
Accessing the preferential tariff rates under the ECTA is not automatic. The goods must meet two requirements: they must satisfy the ECTA rules of origin, and they must be accompanied by a valid Certificate of Origin (COO) issued under the agreement. Both requirements apply. Meeting one without the other is not sufficient for claiming the preference at Australian customs.
Rules of origin under the ECTA
Rules of origin define what makes a product sufficiently “Indian” to qualify for the preferential rate. For most manufactured goods, the ECTA rules of origin require that the goods either originate wholly in India — meaning all materials and processing occurred in India — or that they have undergone sufficient processing in India to meet a defined value-addition or tariff heading change threshold. The specific rule varies by product category and is set out at the HS code level in the ECTA rules of origin annex. Goods assembled in India from components of other origins need to be assessed against the applicable rule for the finished product’s classification. An Indian exporter who is not familiar with rules of origin compliance should not be assumed to be correctly assessing eligibility without verification.
Who issues the ECTA Certificate of Origin in India
In India, Certificates of Origin for the ECTA are issued by authorised agencies designated by the Directorate General of Foreign Trade (DGFT) under the Ministry of Commerce and Industry. The Export Inspection Council (EIC) and various Export Promotion Councils and Chambers of Commerce are among the authorised issuing bodies depending on product category. The COO must reference the ECTA specifically — a general certificate of origin issued by an Indian chamber of commerce does not serve as an ECTA preferential origin document. Australian customs will require the ECTA-specific COO to process the preferential tariff claim. The DGFT website publishes guidance on authorised issuing bodies and the COO application process.
Presenting the COO at Australian customs
Australian Border Force processes the preferential tariff claim at import. The importer — or their customs broker acting on their behalf — must present the ECTA COO with the import entry. The COO is reviewed for validity: it must be issued by an authorised body, must correctly describe the goods including HS code and value, must reference the ECTA, and must not be expired. COOs are typically valid for twelve months from the date of issue. An importer who does not have the COO in hand before lodging the import entry should not attempt to claim the preference and apply for it after the fact — the correct process is to obtain the COO from the Indian exporter before the shipment departs India, as part of the standard documentation package for every consignment where the preference is being claimed.
What the ECTA Does Not Cover
The interim nature of the ECTA means there are product categories and trade policy areas that the agreement does not address, and Australian importers should be clear on those boundaries.
Sensitive agricultural categories — including certain dairy products, wheat, sugar, and rice — were excluded from the Australian tariff commitments under the ECTA or subject to tariff-rate quotas rather than full elimination. Australian agricultural import policy in these categories remains governed by the standard tariff schedule rather than the preferential ECTA rates. Importers sourcing these goods from India should not assume ECTA preference applies without specific verification at the HS code level.
Services trade, investment protection, and intellectual property are areas that the ECTA addresses only partially or in preliminary form. The ongoing CECA negotiations are intended to address these areas more comprehensively, but the timeline for those negotiations and the scope of the eventual comprehensive agreement remain subject to bilateral discussion between the two governments.
Frequently Asked Questions
When did the India-Australia ECTA enter into force and does it still apply?
The India-Australia Economic Cooperation and Trade Agreement entered into force on 29 December 2022. It remains in force as of mid-2025. The agreement is an interim arrangement pending conclusion of a broader Comprehensive Economic Cooperation Agreement, but its tariff commitments are legally binding on both parties in the meantime. Australian importers sourcing from India can continue to claim ECTA preferential rates for qualifying goods provided they meet the rules of origin requirements and hold a valid ECTA Certificate of Origin. Any changes to the agreement’s status would be announced by the Australian Department of Foreign Affairs and Trade and the Indian Ministry of Commerce and Industry.
Do all Indian goods imported into Australia qualify for ECTA preferential rates?
No. The ECTA covers approximately 85% of Indian goods by value under the Australian tariff commitment, which means approximately 15% of categories — including some sensitive agricultural goods and other excluded categories — do not benefit from the agreement. Even within the covered categories, the preferential rate only applies if the goods meet the ECTA rules of origin for the relevant HS classification and are accompanied by a valid ECTA Certificate of Origin. Goods that do not meet the rules of origin — for example, goods assembled in India from non-Indian components that do not achieve the required value addition threshold — must be imported at the standard Australian tariff rate regardless of whether they were shipped from India.
What happens if my Indian supplier provides a standard certificate of origin instead of an ECTA-specific COO?
A standard certificate of origin — issued by an Indian chamber of commerce for general trade purposes — does not qualify as an ECTA preferential origin document. Australian Border Force requires a COO that specifically references the ECTA and is issued by an authorised ECTA-issuing body in India. If your supplier provides a general COO and you lodge an import entry claiming ECTA preference, the claim is likely to be rejected, and the goods will be assessed at the standard tariff rate. In some cases, a false preference claim can trigger penalties. The correct process is to instruct your Indian supplier to obtain the ECTA-specific COO from an authorised issuing body — the Export Inspection Council, a designated Export Promotion Council, or an authorised chamber of commerce — before the shipment departs. Make this a documented requirement in your purchase order or trade contract, not a verbal request at the point of shipment.
Understanding how the India-Australia ECTA affects your landed costs is one part of building a reliable sourcing relationship with Indian exporters. The other part is working with a supply chain partner whose documentation, accountability structure, and pre-shipment process hold up consistently across every order. If you want to understand how NexaCrest approaches sourcing from India — from supplier verification and specification control through to pre-shipment documentation and post-delivery follow-up — the full process is set out at nexacrestinternational.com/how-we-work/. For direct enquiries, you can reach the team at nexacrestinternational.com/contact/.