Editorial: India–New Zealand FTA — a win-win trade agreement
India–New Zealand is uniquely positioned to generate jobs, deepen capabilities, and evolve from transactional engagement into an enduring and embedded partnership
In the current geopolitical uncertainties and trade disruptions — largely resulting from maverick tariff policies of the United States — India has been exploring alternative paths and searching for trade partners that share its vision of economic integration and compliance with the rule-based system. The latest Free Trade Agreement (FTA) with New Zealand reflects a growing trend of like-minded democracies looking for deepening economic ties for mutual benefit. It’s a win-win deal for both countries. Signed by Commerce and Industry Minister Piyush Goyal and visiting New Zealand Trade and Investment Minister Todd McClay, the agreement, a culmination of nearly a year-long negotiations, will cut or eliminate tariffs on 95% of New Zealand’s exports to India, while making all Indian exports to New Zealand duty-free. Wellington has also committed to invest $20 billion in India over the next 15 years. Being hailed as a “once-in-a-generation” opportunity to deepen bilateral economic ties, the FTA will boost two-way commerce in goods and services and promote investments. India is New Zealand’s 12th-largest export market, with bilateral trade currently valued at $2.15 billion, and the aim is to increase it to $6 billion within five years. For Kiwis, it is a foothold in Asia’s growth engine; for India, a nod to labour-heavy exports and skilled mobility. More importantly, the bilateral relationship extends beyond trade. There are nearly three lakh persons of Indian origin living in New Zealand, accounting for 5% of its population. They form a bridge that is both cultural and economic.
Negotiations between the countries were first launched in 2010 but stalled in 2015 after nine rounds. Revived in March last year, the two sides deftly navigated the thorny issue of market access in sensitive sectors like agriculture. The elimination of duties on 100% of Indian exports removes a persistent constraint — tariffs of up to 10% on key tariff lines. This breakthrough provides an immediate competitive impetus to labour-intensive sectors such as textiles, apparel, leather, ceramics, and carpets, alongside high-growth automotive and engineering industries. The deal helps trade diversification for both countries. On one hand, it provides India with duty-free market access to New Zealand, whereas for New Zealand companies, it opens the door to a massive market and reduces its exports dependence on China, thereby boosting the resilience of its import supply chains. With the FTA, India now also has access to a broader regional ecosystem in the South Pacific. For New Zealand, India represents scale, offering a magnitude of opportunity that few geographies can match. With overseas investments exceeding $422 billion, New Zealand’s global footprint is already substantial. India offers a partnership extending into production, technology, and human capital. Coming with an investment commitment of $20 billion, the relationship has a longer-term strategic character, which is uniquely positioned to generate jobs, deepen capabilities, and evolve from transactional engagement into a partnership that is enduring and embedded.
