Under the visionary leadership of Prime Minister Shri Narendra Modi, India and New Zealand have concluded negotiations on a comprehensive, balanced, and forward-looking Free Trade Agreement (FTA). The agreement marks a significant economic and strategic milestone in India’s engagement with the Indo-Pacific region and aligns with the vision of Viksit Bharat 2047.
Formal negotiations were launched on March 16, 2025, during a meeting between Union Minister of Commerce and Industry Shri Piyush Goyal and New Zealand’s Minister for Trade and Investment, Mr. Todd McClay. Following five formal negotiation rounds and several virtual engagements, the agreement was concluded in record time, making it one of India’s fastest-ever FTAs with a developed economy.
Tariff Liberalisation and Market Access
The FTA provides zero-duty market access for 100 percent of Indian exports to New Zealand. India has offered tariff liberalisation across 70 percent of sectors, covering nearly 95 percent of bilateral trade.
This enhanced market access will significantly boost the competitiveness of India’s labour-intensive sectors, including textiles, apparel, leather, footwear, pharmaceuticals, marine products, gems and jewellery, handicrafts, engineering goods, and automobiles. The agreement is expected to directly benefit Indian workers, artisans, women entrepreneurs, youth, and MSMEs by integrating them further into global value chains.
Services, Investment, and Talent Mobility
This agreement represents New Zealand’s most ambitious services offer to date, granting Most Favoured Nation (MFN) treatment across 118 service sectors and approximately 139 sub-sectors. Key areas include IT and IT-enabled services, professional services, education, financial services, audio-visual services, telecommunications, construction, tourism, and travel-related services.
The FTA significantly enhances student and professional mobility. It enables:
Post-study work rights of up to three years for undergraduate and postgraduate students in STEM disciplines, and
Up to four years for doctoral research scholars,
with no numerical caps.
In addition, the agreement provides:
5,000 Temporary Employment Entry Visas for skilled professionals, and
A quota of 1,000 Work and Holiday Visas,
facilitating seamless movement of talent and strengthening people-to-people ties.
Agricultural Productivity and Farmer Safeguards
A dedicated agricultural productivity partnership has been established through Centres of Excellence for apples, kiwifruit, and honey. This collaboration will focus on technology transfer, research cooperation, quality improvement, post-harvest management, supply chain efficiency, and value chain development to enhance farmer incomes in India.
Market access for these products is linked to limited quotas and minimum import prices, ensuring knowledge transfer while safeguarding domestic producers. Sensitive sectors such as dairy, coffee, milk, cream, cheese, yogurt, whey, casein, onions, sugar, spices, edible oils, and rubber have been excluded from market access commitments to protect Indian farmers and domestic industries.
Investment and Strategic Cooperation
New Zealand has committed to promoting USD 20 billion in investments in India over the next 15 years, supporting India’s Make in India initiative across manufacturing, infrastructure, services, innovation, and employment generation.
The agreement also strengthens cooperation in AYUSH, culture, fisheries, audio-visual tourism, forestry, horticulture, and traditional knowledge systems. It promotes medical value travel and positions India as a global wellness and healthcare hub.
Regulatory Cooperation and Trade Facilitation
Beyond tariff liberalisation, the FTA includes provisions for enhanced regulatory cooperation, transparency, streamlined customs procedures, sanitary and phytosanitary (SPS) measures, and the removal of technical barriers to trade. Mutual recognition of regulatory inspections in pharmaceuticals and medical devices will reduce compliance costs, avoid duplication, and accelerate product approvals in New Zealand.
Growing Bilateral Trade
India–New Zealand economic relations have shown steady growth. Bilateral trade reached USD 1.3 billion in FY 2024–25, while total trade in goods and services stood at approximately USD 2.4 billion in 2024, driven primarily by travel, IT, and business services.
