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Australia and India hope to seal by the end of the year an ambitious, comprehensive trade deal that has been stuck in negotiations for over a decade, Australian Prime Minister Anthony Albanese said on Friday.

Speaking after meeting Indian Prime Minister Narendra Modi in Delhi for a bilateral summit, Albanese said the two leaders have agreed to accelerate their economic partnership and strengthen defence ties. 

"We also agreed on an early conclusion of our ambitious Comprehensive Economic Cooperation Agreement as soon as possible, and I am hopeful that we will be able to finalise that this year," Albanese, who is on a three-day visit to India, told reporters.

"This transformational deal will realise the full potential of the bilateral economic relationship, creating new employment opportunities and raising living standards for the people of both Australia and India."

Last year the two countries signed a free trade deal called the Economic Cooperation and Trade Agreement (ECTA), the first signed by India with a developed country in a decade.

However, for the much larger Comprehensive Economic Cooperation Agreement (CECA) discussions had begun in 2011 but were suspended in 2016 as the talks were gridlocked.

Negotiations resumed in 2021 but a deal has remained elusive.

The ECTA came into effect in December and removed duties on 96% of Indian exports to Australia and 85% of Australian exports to India.

Australia’s minister for trade and tourism, who accompanied Albanese on the visit, said on Thursday that trade worth $2.5 billion had benefited from the ECTA deal in January alone.

Apart from trade Albanese and Modi also highlighted the strengthening defence ties between the two countries, after the two leaders discussed the increasingly uncertain global security environment.

A joint statement issued Friday said that the two countries "may continue to explore conduct of aircraft deployments from each other’s territories to build operational familiarity and enhance maritime domain awareness."

Soured relations with China have proved to be a catalyst to defence ties between the two countries. Beyond the bilateral defence cooperation, India and Australia are also security partners in the Quad group together with the United States and Japan.

The joint statement echoed a similar statement issued after the foreign ministers of the Quad nations met last week with a veiled reference to China.

The statement on Friday said that Modi and Albanese reiterated the importance of adherence to international law to meet challenges to the maritime rules-based order, including in the South China Sea, and their support for an open, inclusive, stable and prosperous Indo-Pacific where sovereignty and territorial integrity are respected.

On Thursday Albanese became the first foreign leader to be taken aboard India’s first indigenously manufactured aircraft carrier INS Vikrant, after which he had called India a top-tier security partner for Australia.

Albanese said he also discussed addressing climate change, cooperation on renewable energy, education and critical minerals supply chains in his meeting with Modi.

This was the fourth meeting between the two leaders since Albanese took over as the prime minister in May. He is expected to meet Modi three more times this year on the sidelines of multilateral events including the Quad Summit in Sydney in May and G20 Summit to be hosted in Delhi in September. (Reuters)