Australia will give back 14 historical and cultural artefacts to India that are of disputed provenance. The items include sculptures, photos and a scroll, and are worth an estimated £1.57 million.
The director of the National Gallery of Australia, Nick Mitzevich, said their return would close "a very difficult chapter of our history". He also confirmed that the items would be returned to the Indian government within months.
Some of the disputed pieces date back to the 12th century, when the Chola dynasty presided over a flourishing of Hindu art in Tamil Nadu.
All but one of the works are connected to Subhash Kapoor, a former New York art dealer and alleged trafficker. Kapoor, who is awaiting trial in India, denies all charges. In 2015 he was the subject of a massive US federal investigation known as Operation Hidden Idol that led to the seizure of hundreds of historically significant artefacts.
The Canberra gallery has already returned several other works it acquired via Kapoor, including a bronze statue of the Hindu god Shiva it bought for $5m (£3.6m) in 2008. It has released a statement introducing a new framework for assessing provenance that considered "both the legal and ethical aspects of a work of art's history".
India's High Commissioner to Australia has welcomed what he called an "extraordinary act of goodwill and gesture of friendship".