India and New Zealand have announced the successful conclusion of a comprehensive and forward-looking Free Trade Agreement (FTA), marking a major milestone in India’s global economic engagement and Indo-Pacific strategy. Concluded under the visionary leadership of Narendra Modi, the agreement is aligned with the national aspiration of Viksit Bharat 2047 and represents one of India’s fastest FTAs concluded with a developed country.
A New-Generation FTA Built on Trade, Investment and Talent
Launched on March 16, 2025, during talks between Piyush Goyal, Union Minister of Commerce and Industry, and Todd McClay, Minister for Trade and Investment of New Zealand, the negotiations concluded after five formal rounds and multiple inter-sessional engagements.
The agreement establishes a high-quality, balanced economic partnership anchored on tariff liberalisation, agricultural productivity, investment facilitation and talent mobility—placing people, jobs, and innovation at its core.
Unprecedented Market Access for Indian Exports
Under the FTA, New Zealand has eliminated tariffs on 100% of its tariff lines, granting zero-duty market access to all Indian exports. India, in turn, has offered tariff liberalisation on 70% of tariff lines, covering 95% of bilateral trade value.
This enhanced access significantly boosts the competitiveness of India’s labour-intensive sectors such as:
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Textiles and apparel
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Leather, footwear and handicrafts
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Pharmaceuticals and medical devices
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Engineering goods and automobiles
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Agricultural and marine products
The agreement is expected to directly benefit workers, artisans, women entrepreneurs, youth and MSMEs, while strengthening India’s integration into global value chains.
New Zealand’s Most Ambitious Services Offer to India
The FTA delivers New Zealand’s best-ever services commitment in any of its trade agreements. India has secured access across 118 services sectors, with Most-Favoured Nation (MFN) commitments in 139 sub-sectors, including:
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IT and IT-enabled services
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Professional and business services
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Education and financial services
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Audio-visual, telecom and construction services
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Tourism and travel-related services
This opens substantial opportunities for Indian service providers and high-skill employment.
Boost to Student Mobility and Skilled Professionals
A future-ready mobility framework forms a key pillar of the agreement. The FTA:
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Enables post-study work rights up to 3 years for STEM Bachelor’s and Master’s graduates
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Allows up to 4 years of post-study work for Doctoral scholars
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Removes numerical caps on student mobility pathways
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Introduces a dedicated Temporary Employment Entry visa quota of 5,000 professionals
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Provides 1,000 Work and Holiday visas
The agreement covers diverse professions, including IT professionals, engineers, healthcare workers, educators, AYUSH practitioners, yoga instructors, chefs and cultural professionals—strengthening people-to-people ties.
Agricultural Productivity with Farmer Protection
The FTA establishes Agricultural Productivity Partnerships through Centres of Excellence for apples, kiwifruit and honey. These focus on:
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Technology transfer and research collaboration
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Improved planting material and capacity building
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Orchard management, post-harvest practices and food safety
To protect Indian farmers and domestic industry, market access excludes sensitive products such as dairy, coffee, milk, cheese, sugar, spices, edible oils and rubber. For permitted products, access is linked to quotas and minimum import prices, ensuring safeguards alongside knowledge sharing.
USD 20 Billion Investment Commitment
New Zealand has committed to facilitating USD 20 billion in investments into India over 15 years, supporting manufacturing, infrastructure, services, innovation and employment under the Make in India initiative. Indian enterprises are also expected to benefit from access to New Zealand and wider Pacific markets.
Boost to Pharma, GIs and AYUSH
The agreement streamlines regulatory access for pharmaceuticals and medical devices by enabling acceptance of GMP and GCP inspection reports from global regulators such as the US FDA, EMA and UK MHRA, reducing compliance costs and speeding up approvals.
Commitments on Geographical Indications (GIs) will facilitate registration of Indian wines, spirits and other goods. Cooperation has also been agreed in AYUSH, culture, fisheries, tourism, forestry, horticulture and traditional knowledge, positioning India as a global wellness and medical value travel hub.
Strengthening a Growing Economic Relationship
India–New Zealand economic ties have shown steady growth, with:
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Bilateral merchandise trade at USD 1.3 billion in 2024–25
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Total trade in goods and services at USD 2.4 billion
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Services trade alone reaching USD 1.24 billion, led by travel, IT and business services
The FTA provides a stable and predictable framework to unlock the full potential of this relationship.
Conclusion
The India–New Zealand Free Trade Agreement represents a transformative, new-generation partnership that goes beyond tariffs to focus on people, productivity and prosperity. As the third FTA concluded in 2025 under Prime Minister Narendra Modi’s leadership, it stands as a decisive step toward building a globally competitive, inclusive and resilient Indian economy in line with the vision of Viksit Bharat 2047.
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Source: PIB
