How Australia’s Growing Trade With India Could Benefit Businesses Across the Country

Australia’s expanding trade relationship with India is often discussed in terms of coal, minerals, agriculture and university education.

Those industries matter, but they are only the beginning of the economic story.

When an Australian company wins new business in India, the benefits do not necessarily remain with the exporter. Export growth can generate orders for suppliers, work for transport companies, demand for professional services and income for employees who spend their wages in local communities.

That is why greater trade with India has the potential to benefit Australian businesses that may never export a product themselves.

A major economic relationship

India is Australia’s fifth-largest trading partner, with two-way trade in goods and services valued at $54.4 billion in the 2024–25 financial year.

India also offers something Australian businesses cannot easily find elsewhere: access to a rapidly expanding market of almost 1.5 billion people.

Australia’s Economic Cooperation and Trade Agreement with India, known as ECTA, entered into force on 29 December 2022. It reduced tariffs across a wide range of Australian exports and was designed to give Australian businesses a stronger position in one of the world’s fastest-growing large economies.

By 2026, tariffs had been reduced on 90 per cent of Australian goods exported to India by value, while all imports from India had become duty-free.

The immediate beneficiaries include exporters, but the commercial effects can travel much further.

How an export creates business at home

Consider an Australian mining company supplying India.

It may require engineers, machinery, maintenance contractors, safety equipment, legal advice, accounting, technology services, port access and freight transport.

The exporter earns the contract, but many other Australian businesses help fulfil it.

An agricultural producer selling food or fibre into India may engage packaging companies, refrigerated transport operators, laboratories, marketing agencies, customs specialists and regional workers.

A technology company entering the Indian market may need software developers, cyber-security services, recruitment assistance, finance and international legal advice.

The value of trade is therefore not measured only at the point where a product leaves an Australian port. It also appears throughout the supply chain that made the export possible.

More work for Australian service businesses

Australia’s opportunity in India is not confined to physical goods.

Professional services, finance, health, technology, education, research, tourism and specialist consulting can all form part of a broader economic partnership.

Australia and India are already developing closer connections in critical minerals, clean energy, advanced technology, scientific research and space. Australian engineers and researchers, for example, have been working with Indian counterparts in support of India’s Gaganyaan human spaceflight program.

These relationships can create opportunities for companies that sell expertise rather than commodities.

An Australian consultancy may assist an exporter entering India. A software company may provide systems to an Indian business investing in Australia. A research partnership may produce intellectual property that is later commercialised.

The Australia–India relationship can consequently support businesses of very different sizes and across many different industries.

Indian students support local economies

Education is one of Australia’s most valuable exports.

International education was worth approximately $50 billion to Australia in 2023–24 and was the country’s fourth-largest export category.

The economic contribution does not stop at university or college fees.

Students need housing, groceries, telecommunications, transport, clothing, banking, entertainment and health services. Their families may visit Australia, supporting airlines, hotels, restaurants and tourist attractions.

This means education exports can generate spending well beyond university campuses.

A student arriving from India may contribute directly to an education provider, but the flow-on effects can reach a suburban landlord, a local supermarket, a mobile-phone retailer, a café and numerous other businesses.

Tourism and family connections

Stronger commercial and cultural links can also encourage more travel between the two countries.

Business delegations require flights, accommodation, conference facilities and hospitality. Visiting relatives spend money in local communities. Tourists purchase meals, experiences, transport and retail goods.

No single visitor transforms the Australian economy, but sustained growth in arrivals can support thousands of businesses, particularly those in tourism-dependent cities and regional destinations.

Australia’s large Indian community also gives the relationship a strong personal foundation. Family connections, cultural familiarity and business networks can make it easier for trade and investment relationships to develop.

Indian investment can create Australian activity

Trade operates in both directions.

Indian companies investing in Australia may acquire premises, employ Australian workers, engage local suppliers and purchase professional services.

New investment can create work for construction businesses, real estate agents, lawyers, accountants, technology companies, recruiters and maintenance contractors.

Australian companies investing in India may also expand their operations at home as they prepare for a much larger market.

Success overseas can require additional staff, greater production capacity and more sophisticated support systems in Australia.

The benefit reaches household spending

The flow-on effect continues when export industries and their suppliers employ more people or increase wages.

Workers spend income on housing, food, vehicles, home improvements, entertainment and personal services.

A contract signed between a large Australian exporter and an Indian customer may therefore eventually contribute to demand at businesses that had no involvement in the original transaction.

The pathway is straightforward:

More trade can lead to more production, more supplier activity, more employment and more household spending.

This does not mean that every Australian business will automatically benefit. Opportunities depend on the industries involved, the strength of demand and whether Australian companies can remain competitive.

It does mean that the economic effects of trade are much broader than the name of the exporting company appearing on a contract.

An opportunity for small and medium businesses

Large companies are usually best placed to enter international markets directly, but small and medium businesses can participate by becoming suppliers.

A regional engineering firm does not need an office in New Delhi to benefit from Indian demand. It may supply equipment to an Australian resources company exporting to India.

A small software business may support an Australian education provider recruiting Indian students.

A food manufacturer may initially enter India through a distributor rather than establishing its own overseas operation.

For smaller businesses, the opportunity may lie in joining the trade relationship rather than leading it.

Australian companies should therefore consider not only whether they can sell directly to India, but also whether they can supply the Australian businesses that do.

Diversifying Australia’s trading relationships

The growth of trade with India also offers Australia greater economic diversification.

China remains Australia’s largest trading partner, but relying too heavily on any single market creates vulnerability.

India will not simply replace China, nor should it be viewed only through that comparison. It is an important market in its own right, with different needs, industries and opportunities.

A wider range of trading partners gives Australian exporters more places to sell and reduces the consequences when demand weakens or political tensions emerge in one market.

That resilience matters not only to exporters but also to the suppliers, employees and communities that depend upon them.

What does this mean for Australia?

Australia’s trade with India is not merely a relationship between governments or major corporations.

It can create business for ports, farms, universities, transport operators, technology companies, consultants, builders, retailers and hospitality providers.

The direct exporter may receive the first payment, but the economic value can continue moving through Australian supply chains and communities.

India’s growth will not guarantee prosperity for every Australian company. Businesses will still need competitive products, reliable service, cultural understanding and the patience required to develop international relationships.

However, the scale of the opportunity is difficult to ignore.

A stronger trading relationship with India gives Australian businesses access to more customers, more investment and more commercial connections.

The central opportunity is not simply that Australia can sell more to India.

It is that selling more to India can create more business here at home.

For many Australian businesses, the question is no longer whether India matters. It is how they can participate. That may mean exporting directly, supplying an exporter, attracting Indian investment, recruiting skilled staff, serving international students or building partnerships with Indian firms. The opportunities will differ from one business to another, but as trade between the two countries grows, more Australian businesses are likely to find themselves connected to one of the world's fastest-growing economies.