India and New Zealand have finalised a landmark Free Trade Agreement (FTA), announced jointly by Prime Minister Narendra Modi and New Zealand PM Christopher Luxon on Monday.
The historic deal, concluded in just nine months, reflects strong political will and shared ambition to deepen economic ties between the two countries.
Under the agreement, tariffs on 95% of New Zealand exports to India will be reduced or removed, giving Kiwi businesses access to India’s 1.4 billion consumers.
Officials expect the deal could increase New Zealand exports to India by NZD 1.1 billion to 1.3 billion annually over the next two decades, potentially doubling bilateral trade within five years.
“I’ve just spoken with India’s Prime Minister Narendra Modi following the conclusion of the NZ-India Free Trade Agreement,” Luxon said.
“Boosting trade means more Kiwi jobs, higher wages and greater opportunities for hardworking New Zealanders. This agreement builds on the strong friendship between our countries and opens new doors for businesses across sectors.”
PM Modi described the deal as “an important moment for India-New Zealand relations, with a strong push to bilateral trade and investment.”
He added that the FTA creates “enhanced market access, deeper investment flows, and numerous opportunities for innovators, entrepreneurs, farmers, MSMEs, students, and youth.”
The agreement also paves the way for USD 20 billion in New Zealand investment in India over the next 15 years and strengthens cooperation in sectors including sports, education, culture, and strategic partnerships.
Agricultural partnerships, centres of excellence for apples, kiwifruit, and honey, and support for India’s manufacturing sector are also included.
With bilateral merchandise trade at USD 1.3 billion and total trade in goods and services at USD 2.4 billion in 2024, both leaders expressed confidence that the FTA will significantly deepen economic engagement, create new opportunities, and further cement the India-New Zealand partnership.
However, Winston Peters, leader of New Zealand First and Minister of Foreign Affairs, expressed strong opposition to the newly announced India-New Zealand Free Trade Agreement (FTA), despite his party being an ally of the government.
Peters described the deal as “neither free nor fair” and said it is “a bad deal for New Zealand,” particularly for the dairy sector.
Peters criticised the concessions on immigration and labour, saying,
“On a per capita basis, National has offered far greater access for India to our labour market than did Australia or the United Kingdom… This is deeply unwise given New Zealand’s current labour market conditions.”
Peters also highlighted concerns for farmers, noting that “the India FTA would be New Zealand’s first trade deal to exclude our major dairy products – including milk, cheese and butter,” which make up around 30% of total goods exports.
While affirming New Zealand First’s commitment to strong bilateral relations with India, Peters stressed that the party “exercised the agree to disagree provision” in Cabinet and will oppose enabling legislation when introduced. He concluded:
“We have communicated to Minister Jaishankar New Zealand First’s position on this matter.”
Meanwhile, India’s External Affairs Minister Dr Jaishankar hailed the deal as “a landmark in 🇮🇳–🇳🇿 ties,” noting that it “places our partnership on an accelerated growth trajectory” and “will surely boost trade, investment and economic collaboration across sectors.”
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