MUMBAI: Ahead of Prime Minister Narendra Modi’s visit to Australia this week, Rubix Data Sciences has released Rubix Country Insights – Australia, part of its Country Insights series. The report finds Australia’s growth story remains steady, anchored by resilient domestic demand, cooling inflation, robust Asian trade ties, and a deepening partnership with India spanning trade, critical minerals and defence.
The report shows Australia’s GDP is projected to rise from USD 1.84 trillion in 2024 to USD 2.29 trillion by 2028, with real growth of 2% in 2026 moderating to 1.7% in 2027 before recovering to 1.9% in 2028. Inflation, at 4.0% in May 2026, remains above the Reserve Bank of Australia’s 2%-3% target, with the cash rate at 4.35% after three hikes this year. Australia’s goods trade surplus has nearly halved, from USD 97 billion in 2021 to USD 47 billion in 2025, as import growth (4.5% CAGR) outpaced export growth (-0.1% CAGR). Iron ore (23%), coal (13%), natural gas (12%) and gold (11%) dominate exports, while China remains Australia’s top trading partner (27% of imports, 30% of exports).
On India, the report notes that under the four-year-old India–Australia Economic Cooperation and Trade Agreement (ECTA), India’s trade deficit with Australia more than halved to USD 6.5 billion in FY2026, as imports fell (-10% CAGR) faster than exports grew (2% CAGR); all Indian exports have been duty-free into Australia since January 2026. Refined petroleum products account for 37% of India’s exports to Australia, while coal makes up 45% of India’s overall imports from Australia, reiterating how energy trade continues to anchor the bilateral relationship even as it diversifies. Cooperation is also deepening in critical minerals (Australia holds 21 of 49 minerals critical to India) and in defence, marked by 2025’s first Australia-India Defence Ministers’ Dialogue and a Mutual Submarine Rescue Arrangement.
The report also highlights the AUD 5.1 trillion in foreign investment in Australia, with the US (27%), UK (16%), Belgium (9%), Japan (6%), and Hong Kong (3%) being the top investors in 2025. Mining and quarrying (31%), financial and insurance activities (13%), real estate (12%), manufacturing (10%), and wholesale and retail trade (6%) were the top FDI-attracting sectors. The report further covers the 2026-27 Budget’s energy-security and tax-relief measures, new critical minerals and hydrogen tax incentives, the Australia-UAE CEPA, a Vanuatu strategic partnership, rising defence spending toward 3% of GDP by 2033-34, and a cautious approach to AI governance. Fitch and S&P both affirmed Australia’s ‘AAA’ rating with a stable outlook in late 2025.
Commenting on the release, Tushar Bhaskar, President, Rubix Data Sciences, said: “What most conversations about India-Australia trade miss is the minerals dependency running through it. Australia holds 21 of the 49 minerals India has flagged as critical, at a time when India’s clean energy and semiconductor ambitions need exactly that kind of supply security. We feel that is a bigger long-term story than the trade deficit numbers.”
In conclusion, the report paints a picture of an Australian economy growing moderately even as its trade surplus narrows. Meanwhile, its relationship with India is entering a more consequential phase, positioning India as a growing pillar of Australia’s economic and strategic engagement with Asia.
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