Over the past six months or so, there have been a couple of ‘blink and you’ll miss it’ type events involving India, Australia and New Zealand.

They might have gone unnoticed by many, but they represent opportunities for many businesspeople and CAs, once they cotton on.

For instance, Mike Cannon-Brookes, co-founder and chief executive officer of Atlassian, the Australian multibillion dollar software company, quietly announced in New Delhi in September 2022 that the company would create 1500 jobs in its research and development centre at Bengaluru (previously Bangalore) in southern India.

Bengaluru is known as the Silicon Valley of India and the new jobs would double Atlassian’s operations: there’s a vote of confidence if ever there was one.

A month later, some 12,500 kilometres away, India’s Minister of External Affairs Dr Subrahmanyam Jaishankar visited New Zealand. He inaugurated the Indian High Commission Chancery in Wellington, saying the India–New Zealand relationship was due for a refresh. It was the first official visit to New Zealand by an Indian foreign minister in 21 years and part of the visit was about doing more business between the two countries.

Pictured: Commercial Street is located in the central business district of Bengaluru. Image supplied by Australia India Institute/Credit Jai Narula

Meanwhile, back in Australia...

“The Australia–India relationship is pivotal for our economic and security interests in the Indo-Pacific region,” says Lisa Singh. “Any business that is not looking at India is missing a major opportunity.”

Singh is chief executive of the Australia India Institute, the leading think tank dedicated to enhancing relations between the two countries, based at the University of Melbourne. She is a former Australian senator and was the first person of Indian descent in the Australian Parliament.

The institute hosted a leadership dialogue in New Delhi last September, attended by high-powered businesspeople, politicians and others keen to crank up the Australia–India relationship.

They included Cannon-Brookes, who co-chaired the dialogue, business supremo Jennifer Westacott – who announced in February she has called time on her tenure as CEO of the Business Council of Australia, a position she has held since 2011 – and mining magnate Andrew ‘Twiggy’ Forrest, with a video message from Australian Minister for Foreign Affairs Penny Wong.

Singh says Atlassian’s aim to employ India’s world-class tech-heads is a sign of things to come.

“I think what we’ve seen since COVID-19 is an increase in digitalisation all across the globe,” says Singh. “That’s why every business has to be a technology business. That’s particularly so in India, which has more startups than anywhere else in the world.”

Pictured: Australia India Institute chief executive Lisa Singh and Atlassian’s co-founder Mike Cannon-Brookes. Image supplied by Australia India Institute/Credit Jai Narula

Well placed as a trade partner

Singh continues: “Australia is also scaling up in talent in the field of technology and innovation and is very well placed to partner with India in technology, be that in the fintech space, ed-tech space or the like.”

But there’s still some room for what you might call low-tech trade.

“India’s critical minerals strategy has identified that Australia has 21 of the 49 minerals that it needs,” Singh says, “So, we are incredibly well placed to partner with India to export our critical minerals and rare earths that go into electric cars, solar panels, batteries… all of the technology and products that are needed to decarbonise our economies.”

As well as Atlassian, she says another high-tech business fit for India is Cochlear, the Australian bionic ear implant company.

“Cochlear is paving the way for Australian medical technology in India and has worked with something like more than 20,000 patients in India, most of them children,” she explains.

Like many Australian companies, Cochlear is primed to benefit from the Australia–India Economic Cooperation and Trade Agreement (ECTA) which came into effect on 29 December 2022.

This year, things are already getting busy, with a bevy of businesspeople and Australian ministers heading for the subcontinent for trade and Quad – a diplomatic network between Australia, India, Japan and the US – get-togethers. India will also host the G20 summit in September this year.

Another sign of the growing relationship is the opening in 2023 of Australia’s new consulate general in Bengaluru, its fifth diplomatic office in India. As well as that, there’s the proposed India– Australia joint venture: the Centre of Excellence for Critical and Emerging Technology Policy, also earmarked for Bengaluru.

A trade agreement is an important start

ECTA was set in motion by the previous Morrison government but it’s not an end in itself.

“It’s an important start. It’s obviously not the full free trade agreement; it’s called an interim free trade agreement,” Singh explains. “It does eliminate tariffs on more than 85% of Australian goods exported to India, from sheep and meat to lobsters, avocados, fruit and lentils, to critical minerals and so on. It also eliminates tariffs on 96% of Indian goods that enter Australia.

“This is going to increase bilateral trade from something like A$27 billion to A$50 billion.”

Those numbers should jolt many businesspeople into action, but it seems not everyone’s twigged.

“It’s surprising to me how some Australian businesses are unaware of just what an opportunity India is for their business,” says Singh. She has a tip for CAs and others in business on how to make the most of the opportunity: “I would say if you’re thinking of doing business with India, it is helpful to find local partners on the ground, because those sorts of relationships matter.”

“This is going to increase bilateral trade from something like A$27 billion to A$50 billion.”

Is it time to re-prioritise?

While India and Australia are on track to be business besties, in New Zealand the messages appear mixed, maybe even yeah-nah.

Developing a free trade agreement (FTA) with India was all the go for the country a few years ago. But when Jaishankar visited last October, New Zealand Minister of Foreign Affairs Nanaia Mahuta said a FTA was not a priority, then later insisted in a media statement that, “India is a priority relationship for New Zealand.”

Come again?

Indian media were all over the story and New Zealand news service Stuff called it the “Death of a free trade agreement”.

Yet only the previous month, on the eve of a quick trade mission to New Delhi, Minister for Trade and Export Growth Damien O’Connor also said in a media statement that building trade with India was a priority and India was already New Zealand’s 15th largest trading partner.

China, of course, occupies the top spot.

That New Zealand should seek closer ties with India isn’t surprising. It has an Indian community of some 240,000 people – about 5% of the population. In addition, India’s economy recently eclipsed the UK’s to become the fifth largest economy in the world, making it too big to ignore.

But while Australia seems to be almost on hugging terms with this rising economic superpower, New Zealand seems unforthcoming.

Could things change, with New Zealand even taking a leaf out of Australia’s trade book? Prime Minister Chris Hipkins is due to go to the polls in October and with his recently publicised ‘policy bonfire’, as the media dubbed it, he has already signalled he intends to do things differently.

Could a rethink on India be on the cards?

Put another way, there’s an unusual word in India that at first mystifies visitors to the country: prepone, which is basically the opposite of postpone. To prepone something is to push it forward, rather than leave it on the backburner.

Considering everything else that’s going on in the world, some might argue it’s perhaps time for New Zealand to prepone its FTA, rather than postpone it.

Pictured: Held in New Delhi last year, the Australia India Leadership Dialogue is the premier forum for informal diplomacy between Australia and India. Image supplied by Australia India Institute/Credit Jai Narula

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India–Australia and New Zealand trade at a glance

India

Population: 1.4 billion
Nominal gross domestic product (GDP): US$3.2 billion
Real GDP growth (year-over-year): 8.9%

Australia

Exports to India: A$19.9 billion

Top five exports:
1. Coal
2. Education-related travel
3. Gold
4. Copper ores and concentrates
5. Confidential items of trade.

Imports from India: A$27.8 billion

Top five imports:

1. Refined petroleum
2. Telecom, and information and communication technology (ICT) services
3. Professional, technical and other business services
4. Medicaments (including veterinary)
5. Pearls and gems.

New Zealand

Exports to India: NZ$247.2 million

Top five exports:

1. Travel
2. Miscellaneous provisions
3. Wood pulp
4. Wool
5. Aluminium.

Imports from India: NZ$391.1 million

Top five imports:

1. Mineral fuels and oils
2. Pharmaceuticals
3. Mechanical machinery
4. Pearls, precious stones and metals
5. Electrical machinery and equipment.

Sources: Australian Department of Foreign Affairs and Trade (DFAT) India trade and economic fact sheet and Stats NZ New Zealand International Trade dashboard.

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Support for trade with India

New Zealand Trade and Enterprise and the Australian Trade and Investment Commission are two government organisations that can support businesses looking to trade with India.

In addition, you can contact:

• Asialink Business (for Australian businesses)
• Australia India Business Council
• Australia India Chamber of Commerce
• India Australia Business and Community Alliance
• India New Zealand Business Council
• New Zealand India Trade Alliance

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