Negotiations for the Comprehensive Economic Cooperation Agreement (CECA) between India and Australia have reached an impasse due to deep disagreement over dairy and wine tariffs. Australia is pushing for accelerated tariff cuts on premium wines and expanded market access for dairy products—especially cheese, high-protein whey, and lactose—currently facing import duties of 20–30% in India. Under the 2022 interim pact, wine tariffs were reduced from 150% to 100% for bottles over US$5 and to 75% for bottles over US$15, with plans for further phased cuts. Australian trade bodies argue that faster tariff reductions would benefit consumers and exporters by lowering prices and opening niche market opportunities.
However, India is steadfast in protecting its sensitive agriculture and viticulture sectors. Strong resistance has emerged from farmer groups in Gujarat and Maharashtra, as well as domestic wine and dairy industries, citing potential harm to local producers. India remains open to liberalizing tariffs on industrial goods and seeking improved access for services and visa issuance, but no concessions have been made on agricultural fronts. Both governments remain optimistic, with political backing from both prime ministers and expectations to complete the CECA by year-end, should compromises be found on the contentious sectors.
Industry Insight:
The current stalemate underscores the political and economic sensitivity of dairy and wine sectors in trade discussions. Stakeholders—particularly exporters targeting Indian markets—must monitor these negotiations closely, as any breakthrough or failure could significantly influence market access, pricing, and investment decisions in these commodity sectors.
Source : Dairynews7x7 July 12th 2025