The Australian government on Tuesday said it would introduce a new innovation visa to attract exceptionally talented workers, replacing a controversial investor migrant programme that it argued had few economic benefits.

The changes announced in the annual budget, delivered by Treasurer Jim Chalmers, are part of a broad overhaul of its migration system as Australia aims to lure skilled workers and top talent while reducing overall immigration.

The new visa also replaces the Global Talent visa programme that ends late in 2024, with an aim "to target exceptionally talented migrants who will drive growth in sectors of national importance," said the government.

"The Business Innovation and Investment visa program (BIIP) will cease," it said, referring to the so-called golden visa that offers a pathway to permanent residency through investment in the country.

The centre-left Labor government is facing growing calls to curb migration as a post-pandemic surge in students and other arrivals exacerbated an already tight rental market, fuelling headline inflation.

The government is already stepping up scrutiny on student visas and will introduce a ballot system for the popular work and holiday visa for applicants from China, Vietnam and India from the fiscal year ending June 2025.

The actions are expected to help halve net overseas immigration to 260,000 arrivals in 2024-25 from 528,000 in 2022–23.

(Reporting by Stella Qiu; Editing by Sam Holmes)