India and New Zealand have concluded negotiations on a long-pending Free Trade Agreement (FTA), marking a significant step in strengthening bilateral economic ties at a time when global trade faces mounting uncertainty. The agreement was finalised following high-level discussions between Indian Prime Minister Narendra Modi and New Zealand Prime Minister Christopher Luxon, signalling renewed momentum in India’s trade diplomacy.
Officials on both sides described the pact as a “balanced and forward-looking agreement” designed to expand market access, boost investment, and deepen cooperation across goods, services, and people-to-people links.
What the Deal Brings to the Table
Under the FTA, New Zealand will significantly reduce tariffs on a large share of its exports to India, with many product categories set to become duty-free over a phased timeline. In return, Indian exporters are expected to gain near-complete zero-duty access to the New Zealand market once the agreement comes into force.
According to trade officials, the agreement opens new opportunities for Indian sectors such as:
- Textiles and apparel
- Leather and footwear
- Engineering goods
- Pharmaceuticals
- Information technology and professional services
New Zealand exporters, particularly in horticulture, forestry products, wool, and select minerals, are expected to benefit from improved access to India’s vast consumer market.
Investment, Jobs, and Mobility
A key pillar of the agreement is investment cooperation. New Zealand has indicated long-term investment interest in India, especially in manufacturing, infrastructure, education, and services. Both governments have also highlighted provisions aimed at easing the temporary movement of skilled professionals, students, and business visitors.
Indian officials say these measures could support job creation and skill exchange, while also strengthening ties between businesses and educational institutions in both countries.
Support and Criticism
✅ Positive Responses
Indian business groups, including the textile industry, have welcomed the FTA, citing duty-free access and new export prospects. Union leaders have called it a forward-looking agreement that will create jobs and strengthen people-to-people ties.
⚠️ Political Pushback in New Zealand
However, the FTA has not been universally supported across the Tasman Sea. New Zealand’s Foreign Minister Winston Peters described the deal as a “bad deal” for his country, arguing that it offers limited benefits relative to concessions, and his party plans to oppose it in Parliament.
What Comes Next
The agreement will now undergo legal vetting and domestic approval procedures in both countries. Officials expect the FTA to be formally signed and implemented in 2026, after which tariff reductions and other commitments will begin in phases.
Once operational, the India–New Zealand FTA will join a growing list of trade agreements shaping India’s economic engagement with the Indo-Pacific and beyond.
