India and New Zealand have just wrapped up an important Free Trade Agreement (FTA). This deal, developed with clear direction from Prime Minister Narendra Modi, signals a significant step in India’s economic ties with the Indo-Pacific region.
The FTA is among the fastest negotiated by India. It began on March 16, 2025, when India’s Commerce Minister Piyush Goyal and New Zealand’s Trade Minister Todd McClay met. After several rounds of talks and discussions, the agreement is now in place. It aims to boost job creation, promote skills movement, and drive economic growth, particularly for small and medium enterprises.
Minister Goyal highlighted the agreement as a way to create new opportunities for farmers, entrepreneurs, and students. It aims to improve agricultural yields and farmer incomes, providing a platform for Indian businesses to access new markets. In doing so, it opens doors for the youth to gain global experience.
One major benefit is the elimination of tariffs on all Indian exports, which gives them a competitive edge. Sectors like textiles, leather, and automotive are expected to gain significantly, benefiting Indian workers and artisans by connecting them more deeply with global markets.
New Zealand has also agreed to its most comprehensive services offer yet. This includes commitments in high-value sectors like IT, education, and tourism, paving the way for more opportunities for Indian service professionals.
According to Rajesh Agrawal, Commerce Secretary, this FTA blends tariffs with a focus on investment and talent. India stands to expand its exports and service sectors while New Zealand gains better access to India’s expanding economy.
A big perk of this FTA is its focus on skilled labor mobility. Indian professionals and students now have improved entry provisions, including work opportunities while studying and a new Temporary Employment Entry Visa for skilled professionals. These pathways cover professions such as IT, healthcare, and education.
Agricultural collaboration also takes center stage. Plans have been set to enhance the quality and productivity of products like kiwifruit, apples, and honey. This means better farming technology and practices will support Indian farmers, helping them increase their incomes.
The agreement also strengthens investment ties significantly. New Zealand promises to inject USD 20 billion into India over the next fifteen years, enhancing manufacturing and infrastructure. Indian companies will benefit from access to New Zealand and its neighboring markets.
Regulations in the pharma and medical devices sectors are set to improve. There will be quicker access to market for Indian products, reducing duplicated efforts and speeding up approvals.
Interestingly, the FTA also includes provisions regarding Geographical Indications, which will protect certain Indian products like wines and spirits. This marks an important step for Indian culinary products on the global stage.
Overall, the FTA reflects a growing economic relationship between India and New Zealand. In the 2024-25 period, trade reached USD 1.3 billion. This agreement aims to create a stable framework to fully realize the potential of future economic ties.
All in all, India’s partnership with New Zealand through this pioneering FTA showcases a long-term vision for a strong, inclusive economy as part of the Viksit Bharat 2047 initiative. This is more than just a trade deal; it’s a commitment to collaboration and growth.
Source link
Free Trade,Free Trade Agreement,MSMEs
