E-COMMERCE  /  SME

By Peter Langley | First published: May 31, 2023  Updated: October 29, 2026

The Australia-India Economic Cooperation and Trade Agreement (ECTA) has enabled Australian exporters to save an estimated USD 2 billion in tariffs – and counting. Here’s why Australian SMEs with global ambitions shouldn’t overlook the benefits of this trade agreement.

• The ECTA eliminates or lowers tariffs on over 90% of Australian goods exports by value to India, while removing tariffs on 100% of imports from India.
• For Australian SMEs expanding abroad, this Australia-India trade agreement can help to lower trade costs, enhance supply chain resilience, and unlock access to one of the world’s fastest-growing major economies.
• To succeed in India’s vast and diverse market, Australian SMEs need to carve out a clear niche, develop a targeted strategy, and meet consumer expectations of fast delivery.

It has long been said that Australia and India share a connection built on three Cs: cricket, curry, and the Commonwealth. Now, perhaps it’s time to add a fourth: commerce.

Trade flows between Australia and India have grown rapidly since the signing of the Australia-India Economic Cooperation and Trade Agreement (ECTA), which came into force on 29 December 2022. This bilateral agreement has eliminated or reduced tariffs on over 90% of Australian goods exports by value to India, helping Australian businesses secure access to one of the world’s fastest-growing major economies.

Australian exporters have not been slow to seize these opportunities. Goods exports to India (excluding coal) rose by 68% between 2022 and 2025, from AUD 6 billion to AUD 10.3 billion. During this period, Australia’s agricultural exports to India also soared by 139%.

At FedEx, we see firsthand how trade agreements like ECTA are driving a surge in export volumes across Asia Pacific (APAC). In response, we’re continuously enhancing our logistics network to support exporters’ growing needs. With lower trade barriers and stronger logistics support, India offers immense potential for Australian SMEs looking to expand into new markets.

What is the Australia-India ECTA?

The Australia-India Economic Cooperation and Trade Agreement (ECTA) is a bilateral agreement that eliminates or lowers tariffs on more than 90% of Australian goods exports by value to India while making 100% of imports from India tariff-free.

For Australian businesses, the ECTA lowers barriers to trade across a wide range of industries: wool, wine, energy, horticulture, pharmaceuticals, cosmetics, and more. For example, Australian wine exports to India previously faced steep tariffs of 150% for bottles valued over USD 15. Under the ECTA, these tariffs are being progressively reduced to 25% over nine years.

This landmark Australia-India trade agreement has unlocked new possibilities for exporters in many sectors. For instance, nearly 200 Australian products have entered the Indian market for the first time or returned after a long absence. These include avocados, fresh salmon, electric motors, and various pharmaceuticals.

For Australian SMEs exploring overseas expansion, we see three key opportunities from the ECTA:

1. Lower trade costs

High export costs often hold back SMEs’ global ambitions. By reducing or removing tariffs, the ECTA helps small businesses lower supply chain costs. Businesses can also leverage these cost savings to price their products more competitively and attract new customers.

The numbers speak for themselves: by the end of 2024, exporters from Australia had saved an estimated USD 2 billion in tariffs thanks to ECTA concessions.

2. Access to a massive consumer market

With a population of over 1.4 billion, India's vast market offers massive potential for business growth. It’s home to a fast-growing middle class that, together with affluent consumers, accounts for 80% of the country’s consumer spending. By 2030, India is set to become an “upper middle-income” country based on its gross national income per capita, reflecting a significant increase in the average consumer’s buying power.

For Australian brands, there are more opportunities to reach these consumers online than ever. India’s e-retail market has more than doubled over the last five years, with the number of online shoppers doubling to reach 290 to 300 million in 2025. In major urban centers such as Hyderabad, over 7 in 10 Internet users already shop online. The ECTA makes it easier for Australian SMEs to tap into this growing e-commerce market.

3. Stronger supply chain resilience

In an era of global uncertainty, market diversification enables SMEs to build resilience against geopolitical shifts. By taking advantage of the ECTA to expand into India, Australian exporters can diversify their customer base and increase their competitive edge.

Manufacturers can use the ECTA to diversify their sourcing and strengthen supply chain resilience as well. With tariffs eliminated on imports from India, Australian manufacturers may be able to source inputs such as textiles, automotive components, and petroleum products more cost-effectively.

How can SMEs reap the benefits of the Australia-India ECTA?

While the ECTA opens doors to growth, it takes careful planning to gain a foothold in India’s vast and diverse market. In our experience, Australian SMEs need three ingredients for success.

1. Carve out a niche

Indian consumers have never had greater access to global products at their fingertips. Global e-commerce giants such as Amazon and Flipkart are accelerating their expansion in India, while local quick-commerce platforms including Blinkit and Zepto import specialty goods from abroad. As more Indian consumers discover, compare, and develop a taste for premium international products, SMEs will need to carve out a clear niche to stand out.

In the FMCG sector, for example, brands are winning over premium consumers with health-conscious messaging, natural and organic ingredients, and environmentally friendly packaging. It’s crucial for Australian SMEs to understand what matters to consumers in their industry and tailor their offerings to match those needs.

2. Develop a targeted strategy

In India, it’s often said that the language and culture change every few kilometers. This rich diversity holds true for consumer behavior as well. Consumers in India’s megacities will have different habits, motivations, and preferences from those in tier-two or tier-three cities. What’s more, there are generational differences to account for. Gen Z has become a key audience segment, accounting for 40% to 45% of India’s e-retail shoppers in 2025.

Hence, a tailored strategy is essential for success. Australian SMEs entering India will need to clearly define their target markets and build personalized customer journeys, engagement strategies, and marketing activations. For instance, Gen Z consumers tend to prefer brands that create meaningful interactions rather than relying on overt marketing.

3. Deliver speed and reliability

India’s quick commerce boom is rapidly changing consumer expectations around delivery speed. Platforms such as Blinkit and Zepto, which promise to deliver products in as little as 10 minutes, have accustomed consumers to near-instant fulfillment. This need for speed carries over into the cross-border B2C e-commerce market, where express delivery is projected to grow at a 24.2% CAGR through 2031 as premium buyers increasingly value shipping visibility and reliability.

Hence, efficient logistics is key to competitiveness when exporting to India. Australian SMEs can partner with India-based e-commerce platforms that provide fulfillment services, and work with logistics providers that offer express shipping and robust infrastructure for Australia-to-India trade.

Finding new paths to growth in the Australia-India trade lane

The Australia-India ECTA is just the beginning of a new chapter of trade growth. The two countries are set to accelerate negotiations on a Comprehensive Economic Cooperation Agreement (CECA), which will build on the strong foundations laid by the ECTA. For Australian businesses that have yet to explore India’s potential, perhaps now’s the time to start.

At FedEx, we’re well-positioned to be a reliable growth partner for SMEs expanding into India. With decades of expertise in the region, we’ve developed international shipping services that combine speed with competitive rates, as well as digital tools to streamline customs clearance when exporting to new markets. By tapping the right logistics support, Australian SMEs can stay focused on seizing new opportunities in India and beyond.