Trading links between India and Australia can be traced back to the East India Company. Australia’s first commercial export was a shipment of coal to India in 1797. Coking coal and Gold have become important components of Australia’s trade with India today.
Formal trade relations between India and Australia are covered by a trade agreement signed in 1976, which aims at facilitating, diversifying and strengthening trade ties between the two countries. A Joint Ministerial Commission and a Joint Business Council was established which meets annually to discuss bilateral trade developments.
The bilateral merchandise trade: between India and Australia has grown annually over the past 5 years at around 22 %. It touched A$ 16.5 billion during calendar year 2009 an increase of 7.3% over the previous year.
India’s merchandise exports to Australia are diverse but volumes are not very large. India traditionally exports textiles and clothing to Australia. The main items are pearls, precious, semi-precious stones, made-up articles -textile materials, floor coverings, jewellery, textile yarn, engineering goods/ manufactures, manufactures of base metal, footwear, travel goods & handbags, women's or girls', clothing, men’s or boys' clothing, and other commodities including chemicals and related products, plantation & agricultural products. India’s exports increased to A$ 2 billion in 2009. This was 11 % higher than the corresponding figure of A$ 1.8 billion in 2008. Generating sets & motors, pearls & gems, medicaments, jewellery,textile manufactures and topped the export basket in 2009.
India’s merchandise imports from Australia are confined to a smaller range of mainly primary commodities such as non-monetary gold, coal (coking), copper & concentrates,wool, silver and non-ferrous metal scrap. India’s imports also include chickpeas, dried fruits, peas, pulses, apples and manufactured items. Imports from Australia in 2009 recorded A$ 14.5 billion and increase 6.8 % over the previoius year. The balance of trade continued to be in favour of Australia. In 2009 imports were largely composed of mineral resources. The top three items were non-monetary gold A$ 6.7 billion, coal A$ 4.9 billion and copper ores & conc. A$ 0.82 billion. The three commodities taken together comprised a total of A$ 12.5 billion or 75 % of Australian exports to India. Most of the other commodities in Australia’s export basket also came in from the extractive industry sector.
For the year 2009 India ranked 6th as Australia’s trading partner with a share of 4.2 % in terms of overall trade. India ranked 4th as Australia's export destination with a share of 7.4% of the total imports, while its rank as an import source was 21 with 1.0 % market share in Australia’s total imports.
India Australia Bilateral trade in services in 2009 was A$ 4.37 billion, India's imports of servceis was A$ 3.4 billion and it exports to Australia was 0.67 billion. The major Australian service exports to India were Education – related travel and personal travel (excluding education). The major Australian service imports were Personal travel (excluding education) and Computer & information services.