India and New Zealand concluded a free trade agreement to strengthen economic ties and aim to double bilateral trade over the next five years. This free trade agreement (FTA) is the third agreement of this year, following those with the UK and Oman. It will give India tariff-free access to the Island nation markets.
This pact is expected to improve the competitiveness of India’s labour-intensive sectors, including textiles, apparel, leather, footwear, marine products, gems and jewellery, handicrafts, engineering goods, and automobiles, thereby deepening their integration into global value chains.
The new trade deal is important for India’s economy and strategy in the Indo-Pacific, especially amid current geopolitical tensions.
India has offered New Zealand free market access for more than 70 per cent of tariff lines, covering 95 per cent of bilateral trade value, while excluding almost 30 per cent of products. Additionally, New Zealand recommended allocating $20 billion in investment in the next 15 years.
“Concluded in just nine months, the historic milestone reflects a strong political will and shared ambition to deepen economic ties between the two nations”, PM Narendra Modi said on X while announcing the trade deal with New Zealand’s PM Christopher Luxon.
Also read: India’s Export Bounced Back on Supply Chain Adjustments
Commerce and Industry Minister Piyush Goyal said India will not establish its dairy sector under an FTA to ensure protection of farmers and the domestic industry. Free market access excludes dairy products, including coffee, milk, cream, cheese, yoghurt, whey, caseins, onion sugar, spices, edible oils, and rubber.
