India and Australia Work on a Bigger Trade Deal (CECA) and a Bilateral Investment Treaty
India and Australia are working on two new agreements: a Comprehensive Economic Cooperation Agreement (CECA) and a Bilateral Investment Treaty (BIT). The Union Ministry of Commerce and Industry shared this at the Institute of Chartered Accountants of India's (ICAI) first Oceania International Conference 2026, held in Australia.
The CECA will be a wider, upgraded version of the Economic Cooperation and Trade Agreement (ECTA) that the two countries already have. ECTA came into force in December 2022.
India's exports to Australia have nearly doubled since ECTA: from USD 4 billion in 2020-21 to USD 7.28 billion in 2025-26. Total two-way trade stood at USD 21.09 billion in 2025-26.
The two countries also discussed cross-border taxation problems faced by service providers, mainly IT companies, and ways to cut the compliance burden (the paperwork and checks businesses must go through).
Other areas for closer work include critical minerals (minerals like lithium and cobalt needed for batteries and clean energy), education, renewable energy, technology and agritech.
India-Australia Economic Cooperation and Trade Agreement (ECTA / AI-ECTA)
The India-Australia Economic Cooperation and Trade Agreement (ECTA) is a trade deal that cuts the import taxes (tariffs) each country charges on the other's goods. It also makes it easier to trade services and move students and professionals. It was signed on 2 April 2022 and came into force on 29 December 2022. It is an "early harvest" style deal: the two countries first signed this smaller agreement, and are now building a bigger one, the CECA, on top of it.
The CECA now being worked on is the planned next step after ECTA. ECTA mainly cut tariffs on goods. The CECA is meant to go deeper into services, digital trade and other areas, and it could sit alongside a separate treaty that protects investments.
Bilateral Investment Treaty (BIT) and India's Model BIT (2016)
A Bilateral Investment Treaty (BIT) is an agreement between two countries that protects investors from each country when they invest in the other. It promises fair treatment and protection against unfair seizure of property. If the host country breaks these promises, the investor can take the matter to international arbitration. India writes its BITs based on a "model" text, which works like a standard template. The current template was approved by the Union Cabinet in December 2015 and is often called the 2016 Model BIT.
India and Australia do not have a BIT in force now; their old BIT was among those India ended after 2016. A new India-Australia BIT would give Australian and Indian investors fresh legal protection, and would help capital flow into areas like critical minerals.
Double Taxation Avoidance Agreement (DTAA)
A Double Taxation Avoidance Agreement (DTAA) is a treaty between two countries that decides which country can tax which income. Without it, a company earning money in one country while based in another could be taxed twice on the same income. A DTAA removes or reduces this double tax. It also helps tax offices of the two countries share information to stop tax evasion.
The two countries discussed cross-border tax issues still faced by service providers, especially IT firms. Such problems are handled through the DTAA and tax cooperation, not through the BIT, because India keeps taxation outside its investment treaties.
- India-Australia ECTA: signed 2 April 2022; in force 29 December 2022
- Zero-duty access for all Indian exports to Australia from 1 January 2026
- India's exports to Australia: USD 4 billion (2020-21) to USD 7.28 billion (2025-26)
- India-Australia bilateral trade: USD 21.09 billion (2025-26)
- CECA talks launched May 2011; re-launched September 2021
- India-Australia DTAA in force since 1991
- India has terminated 77 older BITs since 2016
- Model BIT local-remedies period: 5 years; cut to 3 years in UAE (2024) and Israel (2025) treaties