Australia-India trade deal: Building trust a ‘stepping stone’ but chickpeas unlikely to benefit any time soon

Federal Trade Minister Dan Tehan says building trust with Indian farmers is a “stepping stone” for greater market access but has conceded chickpeas are unlikely to enter India tariff-free any time soon. Mr Tehan provided no certainty about whether chickpeas would be included in future iterations of the Australia-India Economic Cooperation and Trade Agreement while visiting Perth last week with an with an Indian trade delegation travelling around Australia. He met with WA farm advocacy groups and agriculture businesses including the Pastoralists and Graziers Association of WA, WAFarmers and CBH Group at the Ritz Carlton in Perth on Friday. Mr Tehan said it was important to remember there were 160 million farmers in India and market access — particularly for wheat — was a sensitive topic and the focus now was on “building trust”. “We now need to work on cooperation or where we can invest, where we can build trust between farmers in India and farmers in Australia, and use it as a stepping stone to then – hopefully – gain greater market access over time,” Mr Tehan said. “Both countries will work towards mutual cooperation in the agricultural sphere, we’ll be able… to make sure this agreement continues to provide for farmers in both countries.” Australia’s red meat industry celebrated but the grains sector was left disappointed after the agreement eliminating tariffs on 85 per cent of exports worth $12.6 billion was announced. Some of the biggest agricultural benefits included the immediate removal of a 30 per cent tariff on sheep meat, a 10 per cent tariff on raw skins and a 2.5 per cent tariff on Australian wool. National grain groups continue to probe whether chickpeas could be included in the finalised agreement this year and potentially remove a 30 per cent tariff was imposed in December 2017. Chickpea exports to India stopped overnight when the tariff was introduced, but Australian farmers’ hopes were raised when the Indian Government ditched a similar tariff on lentils in February. WAFarmers president John Hassell said his impression from the meeting was that removing the chickpea tariffs was “not on the table”, but he welcomed the changes for sheepmeat and wool. “The focus on the meeting was strengthening ties, which I think is a good thing,” he said. “But it would be a very tall ask for us to get into the chickpea market because Indian farmers are very protective of it. “I understand that. There is a lot of work on other areas but that one seems to be non-negotiable.” There was also no news on barley exports, with India and its burgeoning beer market previously identified as a major growth opportunity for malt barley producers. Mr Tehan said the Federal Government also hoped to “sort out” phytosanitary issues regarding barley – particularly around radish weed seeds - and “get barley into India on a regular basis”. The Indian Government in 2020 removed a requirement of treating grain with methyl bromide which damaged malt barley, meaning barley could be fumigated with phosphine instead. “We will then look and see what we can do with other pulses, and ultimately with wheat,” he said. “But we do have to understand there are 160 million farmers in India and wheat in particular is an incredibly sensitive issue. “It is one that will take a period of time but hopefully, in regards to pulses, there will be more opportunities down the track.” O’Connor MP Rick Wilson, who joined Mr Tehan in the meeting, said the agreement was about “building relationships” and bolstering what was already a $24 billion two-way trade. “It is an exciting opportunities for farmers… chickpeas are a stable diet of the subcontinent and this is an issue where the Indian government is protective of its own industry,” he said. “There is work to be done there but this agreement is the first step… it is about building relationships so that moving forward, we can have access to 1.35 billion consumers.” India was the world’s largest lentil market before introducing the tariffs in 2017, importing more than $900 million of lentils in 2017. Imports fell sharply in 2018 but have risen steadily in later years. Australia’s two-way agricultural trade with India is worth more than $1 billion, with lentils, greasy wool, almonds, raw cotton and oats some of the key exports to India. Separately, Perth Airport is trying to coordinate direct flights to India.