Australia provides excellent opportunities to India in IT sector, besides other services, says the country’s High Commissioner to India, Peter Joseph N Varghese A O. He tells Dilasha Seth that several Australian companies are eyeing outsourcing legal services to India. Neither India nor Australia believes that negotiations on FTA are going to be easy, he adds. Edited interview:
India wants to improve services exports, including IT ones, to Australia. What kind of scenario do you visualise?
Australia continues to be among the fastest-growing markets for Indian IT majors. There are 18 large Indian companies in Australia. As the Australian government is developing a national broadband network, with an investment over A$40 billion (Rs 1,80,000 crore), to take broadband connectivity to every home, we see big opportunities for IT companies. Similarly, Australian IT companies have also found a good foothold in India. iSoft, a health software firm, has nearly 2,000 employees in India. Several Australian majors are looking at outsourcing legal services to India. There is a movement in the area of back-office work too. There are opportunities in a range of other services sectors, including financial and professional services.
What is on the cards so far as India-Australia economic relations are concerned?
The Australia-India trade and economic relationship is now diverse and dynamic. Two-way trade reached A$22 billion (Rs 99,000 crore) in 2010. Australia is now India’s fifth largest source of imports. Recognising this dynamism, Australia’s Trade Minister Craig Emerson and India’s Commerce and Industry Minister Anand Sharma launched negotiations for a Comprehensive Economic Cooperation Agreement or Free Trade Agreement in May this year.
Australia estimates that FDI (foreign direct investment) from India into Australia is now approximately A$5 billion (Rs 22,500 crore), and is likely to double in the next three years as major projects already announced by Indian companies are realised.
When can we see India-Australia FTA talks concluding?
The first round of negotiations was held in Delhi in July, and a second round is scheduled to take place before the end of the year. The FTA can be a useful step in driving the growth of bilateral trade, which is anticipated to double to A$40 billion (Rs 180,000 crore) over the next five years. But I don’t think either side expects the negotiations to be easy.
India’s numbers are pointing towards a slowdown and inflation has been stubborn at over 9 per cent. What according to you is going wrong?
The Indian economy is performing very strongly in a global context, being one of the key engines of growth. If we take a longer-term perspective on inflation, it is a sign of the rapid pace at which India is transforming and integrating with the global economy. India’s policymakers have their eye on the ball: anchoring inflation expectations, expanding the economy’s productive capacity, attracting more private investment, and investing in infrastructure and human capital to sustain growth, and most importantly, create jobs. As in many countries, including Australia, garnering support for reform never proves easy.
