Indian Economy News

India and New Zealand Announce Conclusion of Landmark Free Trade Agreement Negotiations

A comprehensive, balanced, and forward-thinking Free Trade Agreement (FTA) between India and New Zealand has been signed under the leadership of Prime Minister Mr. Narendra Modi. The FTA is an important step in India's long-term relationship with the Indo-Pacific Region, as outlined in a recent press release. On March 16, 2025, the FTA was formalized during talks between Union Minister for Commerce and Industry of India, Mr. Piyush Goyal, and Todd McClay, Minister of Trade & Investment of New Zealand, making this FTA one of the fastest to close with a developed nation. The FTA will support a high-quality economic partnership, create jobs through increased mobility of skills, spur trade and investment-driven economic growth, promote agricultural productivity through innovation, and allow Micro, Small, and Medium Enterprises (MSMEs) to participate in strengthening and maintaining long-term economic resilience.
Under this agreement, New Zealand will provide zero-duty access to Indian exports for 100% of the value of those exports. India has provided tariff concessions for 70% of its products, totalling 95% of the total trade between both countries. By providing this enhanced level of access, it is expected that the competitiveness of labour-intensive sectors (i.e., textiles, apparel, leather, engineering goods, agriculture products, etc.) will be improved and allow for a more integrated participation in international value chains. The FTA will also contain the most ambitious service offer by New Zealand to date, which includes IT-related services and IT-enabled services, professional services, educational services, financial services, tourism, construction, and business services. The FTA will also contain provisions for the increased accessibility of students and professionals through post-study work visas for STEM graduates and doctoral students, as well as to support joint productivity initiatives and centres of excellence in apples, kiwifruit, and honey. New Zealand has committed to support Rs. 1.81 lakh crore (US$ 20 billion) worth of investments in India over the next 15 years, in line with the "Make in India" initiative.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.