Australia to remove tariffs on all Indian exports from January 2026

Australia will eliminate tariffs on all goods exported from India starting January 1, 2026, marking a major step in strengthening bilateral trade ties under the India–Australia Economic Cooperation and Trade Agreement (ECTA).

The move will make 100 per cent of Australian tariff lines duty-free for Indian products, giving exporters unrestricted access to the Australian market and significantly improving the competitiveness of Indian goods. The tariff removal represents the final phase of liberalisation committed under ECTA, which came into force in December 2022.

ECTA is an early-harvest trade agreement that provides preferential market access to both countries and is seen as a precursor to a broader comprehensive free trade agreement. While Australia will offer complete tariff elimination for Indian exports by 2026, India has provided preferential or zero-duty access to a large share of Australian exports, with some sensitive sectors subject to phased reductions or exclusions. The arrangement is therefore reciprocal, though the pace and coverage of tariff cuts differ for each country.

Commerce and industry officials said the decision would deliver a major boost to Indian exporters by reducing costs, improving margins and expanding access to a developed consumer market. It is also expected to strengthen supply chains and encourage deeper economic engagement between the two countries.

Several key Indian sectors are set to benefit from the tariff elimination. Textiles and apparel exports, including garments and home furnishings, are expected to gain market share due to improved price competitiveness. Gems and jewellery, particularly cut and polished diamonds and gold jewellery, will benefit from lower entry barriers in the Australian market.

Engineering goods and manufactured products, including machinery, tools, metal products and industrial components, are likely to see higher demand. Chemicals and pharmaceuticals, a growing component of India’s export basket, are expected to expand their presence due to duty-free access and steady demand from Australia’s healthcare and industrial sectors.

Other sectors that stand to gain include leather and footwear, plastics and rubber products, petroleum and petrochemical products, and processed food and agricultural items such a s spices, coffee and marine products . Industry representatives say labour-intensive sectors and micro, small and medium enterprises are likely to be among the biggest beneficiaries.

Since the implementation of ECTA, bilateral trade between India and Australia has shown steady growth. Officials on both sides have indicated that discussions are ongoing to expand the agreement into a comprehensive economic cooperation framework covering services, investment and deeper trade integration.

The full removal of tariffs is expected to further accelerate trade flows and reinforce the strategic economic partnership between India and Australia in the coming years.