Australia is keen to include legal services in the free trade agreement (FTA) being negotiated with India despite the fact that the sector, at present, is closed to foreign players and New Delhi’s plans of partially opening it up are still tentative. There are two attorney generals in a team of about 24 Australian officials that is in India for the eighth round of negotiations on the FTA, formally known as the Comprehensive Economic Cooperation Agreement (CECA), a government official told BusinessLine. Negotiations began on Wednesday and will go on till Friday.
“The Australians want the legal sector to be included in the pact, although there is no clarity yet on the commitments they want. We are hesitant as legal services are not open to foreigners at the moment and we cannot take on any commitments based on what might happen in the future,” the official said. Both sides are looking at signing the CECA, which would result in lower tariffs on trade in goods and more opening up of the services sector by the end of this year.
While India does not want to allow foreign lawyers in litigation, the government is looking at the possibility of opening up non-litigious services and international arbitration. “A committee of secretaries, headed by the Cabinet Secretary, is giving finishing touches to a note on phased opening up of the sector and a Cabinet note is likely to be drafted by the legal services department based on that,” another official said.
There is a possibility that the Australians might want an in-built mechanism that would ensure that once the sector is opened up, the provisions become part of CECA commitments. “India is likely to oppose such a mechanism. All that we may be ready for is an agreement to hold negotiations on the sector once it is opened up,” the official added.
The CECA holds potential as annual bilateral trade between India and Australia is around $15 billion, while China-Australia trade is at $160 billion. New Delhi wants greater access for professionals, textiles, pharmaceuticals, engineering goods, leather and automobile parts, while Australia wants collaboration in the dairy sector and commitments in services sectors such as insurance, e-commerce and legal.
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