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WA in prime position to build ties with India

On the eve of his departure for India this week, Premier Colin Barnett labelled the emerging Asian giant the “next big frontier” for WA.

At a time when some of the shine looks like coming off the relationship with China, the timing of the State’s pivot to India could hardly be better.

The State wants new major customers for its minerals and resources but also needs to diversify its economy to lessen its dependence on a small number of primary commodities. India may provide an answer on both fronts.

India has long been in the shadow of China. In economic development, it is still well behind its imposing neighbour. As Mr Barnett points out, WA’s total trade with India last year was $1.9 billion, dwarfed by the $66.4 billion in trade with China.

But in potential, India offers enormous opportunities for WA, and not just as a market for the State’s raw resources.

In population, India almost rivals China and its burgeoning middle class means its demand for goods and services is expected to grow significantly in coming decades.

Head of the International Monetary Fund Christine Lagarde set the stage for the Indian boom when she visited the country last month. Ms Lagarde described the country as a “bright spot” in the global economy. With growth forecast at 7.2 per cent this financial year and 7.5 per cent next year — based on gross domestic product calculations — India is predicted to be the fastest-growing large economy in the world.

Indian Prime Minister Narendra Modi made it clear when he addressed Federal Parliament in November that he saw Australia as a vital partner in his country’s quest for progress and prosperity.

For WA, minerals and resources are still an important part of the picture. Mr Barnett met Mr Modi on the sidelines of the G20 leaders gathering in Brisbane last year where the Indian leader confirmed his country’s interest in the State’s liquefied natural gas. The fledgling uranium mining industry in WA should be poised to take advantage of the resumption of sales to India.

WA is also ideally placed to expand exports in a range of agricultural produce, education services for overseas students and technical know-how in a range of fields, including mining and agriculture.

Our common geography on the Indian Ocean rim, shared language and cultural ties make WA and India natural partners.

There are still obstacles to India fulfilling its potential. While it maintains the democratic institutions inherited from the British colonial days, there are still huge inequities in Indian society and barriers to women and people from lower classes participating fully in the workforce. Official corruption is still a significant problem.

These are issues for India to resolve but WA, with an advanced society and economy, can offer support and experience in overcoming them.

Negotiations are under way for a free trade agreement between Australia and India, which should cement bonds between the two nations and put WA in prime position to capitalise on the boom to come.