India and New Zealand have entered a promising new chapter in their economic partnership with a recent free trade agreement (FTA). This deal paves the way for completely duty-free access for all Indian exports to New Zealand. On the flip side, India will gradually lower tariffs on around 70% of its goods, covering almost all of New Zealand’s exports.
Sectors like textiles, leather goods, and processed foods stand to gain quickly, while sensitive areas like dairy products are being kept safe for now. This FTA isn’t just about goods. There’s a strong focus on services too. New Zealand is opening doors in over a hundred sectors, providing opportunities for Indian professionals and startups.
A significant aspect of this agreement is its emphasis on mobility and investment. It introduces visa pathways for students and skilled workers and encourages collaboration in fields like agriculture and traditional health systems. This includes deepening ties in Ayurveda and other traditional practices. Additionally, there’s talk of a $20 billion investment pipeline aimed at enhancing farm productivity and supply chains.
Prime Minister Narendra Modi has shared that this FTA will boost exports and support India’s small and medium enterprises (MSMEs). It’s not just about trade; it’s also a way to connect talent and innovation between the two nations.
This agreement was signed at Bharat Mandapam in New Delhi by India’s Commerce Minister Piyush Goyal and New Zealand’s Minister for Trade Todd McClay. The government hopes to put this FTA into action within the next six months after necessary approvals from both countries.
Historically, India has signed multiple FTAs in recent years, with New Zealand being the seventh. The talks for this FTA originally began in 2010 but hit a pause until they picked up again in March 2025. The goal remains to reduce tariffs while safeguarding India’s vital agricultural policies.
Experts note that the FTA’s tariff structure is quite lopsided. For example, New Zealand’s average import tariff is just 2.3%, while India’s is much higher at 16.2%. This means Indian exporters already had a good foothold in New Zealand before this new deal.
The FTA aims to eliminate tariffs on all of New Zealand’s goods right from the start, benefiting exports like textiles and leather. Meanwhile, India will open its market to 70% of New Zealand’s exports, including wool and wine. Even so, sensitive agricultural products remain protected through special measures, ensuring Indian farmers are not adversely affected.
This agreement may not radically change the existing modest trade, which was around $2.1 billion in 2025; however, it serves as a framework for deeper collaborations. Experts suggest that it opens doors to a prosperous market and fosters a more predictable trading environment. But to truly succeed, both countries need to go beyond just cutting tariffs and work on enhancing supply chains and other sectors like education, tourism, and technology.
With over 300,000 Indians currently residing in New Zealand, they can be vital players in this trade relationship. Easier visa policies and direct flights could significantly enhance trade and investments moving forward.
Industry leaders are optimistic about the FTA. Pankaj Chadha from the Engineering Export Promotion Council noted that it would unlock new opportunities for the engineering sector, especially for MSMEs. Meanwhile, Mohit Singla from the Trade Promotion Council mentioned that the lowered tariffs would improve competitiveness for Indian exporters in premium markets in New Zealand.
In today’s changing global landscape, India’s efforts to secure FTAs are timely. Kirit Bhansali from the Gem and Jewellery Export Promotion Council highlighted that these agreements allow India to diversify its export markets effectively. With this latest FTA, there’s potential for India’s gems and jewellery exports to New Zealand to soar significantly in the coming years.
This agreement marks a defining moment for trade between India and New Zealand, setting the stage for mutual growth and stronger ties.
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