Australia to Remove All Import Duties on Indian Exports from 2026

In a major boost to bilateral trade relations, Australia will eliminate customs duties on 100 per cent of its tariff lines for Indian exports from January 1, 2026. The decision has been taken under the India-Australia Economic Cooperation and Trade Agreement (Ind-Aus ECTA) and is expected to significantly improve market access for Indian exporters.

This step marks a major milestone in strengthening economic ties between India and Australia, particularly benefiting labour-intensive and MSME-driven sectors.

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Australia to Remove All Import Duties on Indian Exports from 2026

Tariff-Free Access Under Ind-Aus ECTA

The announcement comes as India and Australia complete three years of the Ind-Aus ECTA, which came into force in December 2022. From January 2026 onwards, every product exported from India will enter the Australian market at zero customs duty.

This tariff elimination will:

• Improve price competitiveness of Indian goods
• Strengthen bilateral supply-chain integration
• Enhance India’s access to a developed, high-income market

Export Growth and Sectoral Performance

According to Union Commerce and Industry Minister Piyush Goyal, India’s exports to Australia grew by 8 per cent in FY 2024–25, helping improve India’s trade balance.

Strong export growth was recorded in:

• Manufacturing goods
• Chemicals and plastics
• Pharmaceuticals
• Petroleum products
• Gems and jewellery

Notably, gems and jewellery exports rose by 16 per cent during April–November 2025. Agricultural exports also expanded across fruits and vegetables, spices, coffee, and marine products.

Benefits for MSMEs and Labour-Intensive Sectors

The removal of tariffs will be especially beneficial for labour-intensive sectors, including:

• Textiles
• Leather goods
• Engineering products
• Gems and jewellery
• Processed food

Lower landed costs will improve export margins and volumes, particularly for MSMEs, which often operate under tight cost structures. For Australia, the arrangement ensures reliable sourcing from India under predictable trade rules.

Path Towards Deeper Economic Integration

The Ind-Aus ECTA is seen as a foundation for a broader Comprehensive Economic Cooperation Agreement (CECA), negotiations for which are currently ongoing. The tariff-free regime supports major Indian initiatives such as Make in India and the long-term vision of Viksit Bharat 2047, aimed at boosting exports, attracting investment, and strengthening strategic economic partnerships across the Indo-Pacific region.

Exam-Oriented Key Facts

• Ind-Aus ECTA came into force in December 2022
• From January 1, 2026, Australia will provide 100% zero-duty access to Indian exports
• Labour-intensive sectors are the biggest beneficiaries
• India’s exports to Australia grew 8% in FY 2024–25
• A Mutual Recognition Arrangement on organic products was signed to reduce compliance costs

Question & Answer

Q1. Under which trade agreement will Australia eliminate all customs duties on Indian exports from 2026?
(a) RCEP
(b) SAFTA
(c) Ind-Aus ECTA
(d) CEPA
Answer: Ind-Aus ECTA

Q2. From which date will Australia provide zero-duty access to all Indian exports?
(a) January 1, 2025
(b) April 1, 2026
(c) January 1, 2026
(d) December 31, 2026
Answer: January 1, 2026

Q3. Ind-Aus ECTA came into force in which year?
(a) 2020
(b) 2021
(c) 2022
(d) 2023
Answer: 2022

Q4. Which sectors are expected to benefit the most from tariff elimination under Ind-Aus ECTA?
(a) Capital-intensive sectors
(b) Labour-intensive sectors
(c) Defence manufacturing
(d) Mining sector
Answer: Labour-intensive sectors

Q5. India’s exports to Australia grew by how much in FY 2024–25?
(a) 5 per cent
(b) 6 per cent
(c) 7 per cent
(d) 8 per cent
Answer: 8 per cent

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