Recently, India and New Zealand have just concluded negotiations for a forward-looking FTA, marking a historic milestone in bilateral economic relations.
What is India – New Zealand Free Trade Agreement (FTA)?
FTA – A Free Trade Agreement (FTA) is a pact between two or more countries to lower or eliminate barriers to trade, like tariffs (taxes) and quotas.
It makes it easier and cheaper to exchange goods, services, investments, and intellectual property across borders, fostering economic ties and opposing protectionism.
These agreements create a predictable, transparent environment, benefiting businesses by reducing costs and increasing market access globally, with specifics varying but generally covering customs, regulations, and IP.
India-New Zealand FTA – The Agreement delivers unprecedented duty-free access for Indian exports to New Zealand while:
Safeguarding India’s sensitive sectors,
Strengthening economic resilience, and
Promoting inclusive growth aligned with India’s national priorities.
Background – India and New Zealand announced negotiations for a Free Trade Agreement (FTA) In March 2025.
Following several rounds of negotiations, the India-New Zealand FTA was concluded in December 2025, becoming one of India’s fastest-concluded FTAs.
This FTA enhances market access and tariff preferences for Indian exports to New Zealand, while serving as a gateway to the wider Oceania and Pacific Island markets.
What are the India – New Zealand bilateral trade ties?
Merchandise Trade – Grew from USD 873 million in 2023–24 to USD 1.3 billion in 2024–25, registering a 49% growth.
Merchandise Exports to New Zealand – Rose to USD 711 million in 2024–25, showing a positive trend of 32%.
In 2024-25, the exports from India to New Zealand was higher than imports from New Zealand, maintaining positive trade balance with the country.
Services Trade – India’s services exports to New Zealand grew by 13% in 2024, reaching USD 634 million. Major sectors include travel, IT, and business services.
What are the areas of cooperation and Gains to India from FTA?
Enhanced Market Access for Indian Goods – New Zealand’s market access offer covers immediate elimination of duties (zero duty) on 100% of tariff lines of New Zealand (8,284 tariff lines), from Entry into Force.
New Zealand maintained tariffs around 10% in around 450 lines of key Indian exports in products including textile/apparel products, leather and headgear, ceramics, carpets, automobiles and auto components.
Additionally, the average applied tariff at 2.2% in 2025 will become zero from EIF.
The offerextends gains to several products and sectors
Labour intensive sectors like textiles and clothing, leather and footwear;
Emerging and advanced engineering sectors like transport/auto, pharmaceuticals, plastic & rubber, electrical & electronic machinery, mechanical machinery, chemicals and;
Agri Products like fruits and vegetables, coffee, spices, cereals, processed foods
Gains from import to support domestic industries – Wooden logs, coking coal, waste and scrap of ferrous, non-ferrous metals.
Gains for Agriculture, Technology Cooperation, and Farmer Income Growth – New Zealand have agreed on focused Action Plans for kiwifruit, apples, and honey to improve productivity, quality, and sectoral capabilities of these fruits growers in India
The cooperation includes:
The establishment of Centres of Excellence,
Improved planting material,
Capacity building for growers,
Technical support for orchard management,
Post-harvest practices,
Supply chains and food safety.
Projects for premium apple cultivators and sustainable beekeeping practices will enhance production and quality standards.
This is paired with Market access for the selected agricultural products (Apples, Kiwifruit, and Manuka Honey) from New Zealand in India.
This access will be managed through a Tariff Rate Quota (TRQ) system with Minimum Import Price and seasonal imports, ensuring consumer choice while protecting domestic farmers.
All TRQs are linked to Agri-technology Action Plans and monitored by a Joint Agriculture Productivity Council, balancing market access with protection of sensitive domestic agricultural sectors.
What are the Enhanced Opportunities beyond Goods?
Services– Commitment across 118 services sectors, with Most-Favoured Nation (MFN) treatment in 139 sectors.
Health & Traditional Medicine Annex – For the first time, New Zealand has signed an annex to facilitate trade in Ayurveda, yoga, and other traditional medicine services with India.
This landmark provision promotes the global recognition of India’s AYUSH systems, supports medical value travel, encourages collaboration in wellness services, and reinforces India’s position as a global hub for health, wellness, and traditional medicine services.
It gives centre stage to India’s AYUSH disciplines (Ayurveda, Yoga & Naturopathy, Unani, Sowa-Rigpa, Siddha, and Homeopathy) alongside Maori Health practices
Student Mobility – New Zealand signed Annex on Student Mobility and Post Study Work Visa for the first time with any country.
Indian students can work up to 20 hours per week while studying, even if there are policy changes in future, with extended post-study work visas.
Professional Pathways – A quota of 5,000 visas for skilled Indians for stay upto 3 years in the sectors of interest to India.
This include Indian iconic occupations (AYUSH practitioners, Yoga Instructors, Indian Chefs, and Music Teachers) and Other sectors of interest - IT, Engineering, Healthcare, Education, and Construction
Working Holiday Visa – 1,000 young Indians annually can avail multiple entry in New Zealand for a period of 12 months.
These provisions create unprecedented opportunities for Indian youth and professionals to gain global exposure.
Investment and Economic Co-operation
FDI Commitment – New Zealand will invest USD 20 billion in India over 15 years, strengthening long-term economic ties.
Organic Primary Products – Mutual recognition of organic certification to be agreed between the two sides.
MSME Cooperation – Institutional linkages to help small businesses access trade-related information and global markets.
Technical Assistance – Cooperation has been agreed in AYUSH, audio visual industries, tourism, sports and traditional knowledge systems.
Health collaboration – The FTA promotes India’s AYUSH systems internationally, encourages medical value travel, and positions India as a global wellness hub.
Cultural & Traditional Knowledge – Dedicated cooperation in Ayush and Indian traditional knowledge has been agreed.
Engagement with New Zealand’s indigenous Maori communities to promote cultural exchange and mutual respect.
This strengthens India’s soft power and global recognition of its heritage.
Pharmaceuticals & Medical Devices – Annexes for expedited regulatory pathways and recognition of inspections from trusted regulators (US, EU, UK, Canada).
Intellectual Property Rights – Binding commitment by New Zealand to amend its laws within 18 months to provide EU-level protection for India’s Geographical Indications (GIs).
Customs & Trade Facilitation – Advance rulings, electronic documentation, and faster clearance times (within 48 hours, 24 hours for perishables).
Rules of Origin (ROO) – Robust framework to prevent circumvention and ensure integrity of preferential access.
Sectoral Highlights – The India–New Zealand FTA secures duty free or preferential access across a wide range of sectors.
These gains are expected to boost India’s exports, create jobs, and strengthen the competitiveness of Indian industries in the Oceania region.
What are India’s global trade networks?
India’s FTA with other countries – It enhances competitiveness by reducing or eliminating tariffs and by improving market access for goods and services.
India -Oman Comprehensive Economic Partnership Agreement (CEPA), 2025
India -UK Comprehensive Economic and Trade Agreement (CETA), 2025
India-EFTA Trade & Economic Partnership Agreement (TEPA) with Switzerland, Norway, Iceland, and Liechtenstein, 2024
India- United Arab Emirates Comprehensive Economic Partnership Agreement (CEPA), 2022
India- Australia Economic Cooperation and Trade Agreement (ECTA), 2022
India – Mauritius Comprehensive Economic Cooperation and Partnership (CECPA), 2021
What lies ahead?
The India–New Zealand Free Trade Agreement reflects a defining moment in India’s trade diplomacy, opening new avenues for comprehensive economic cooperation.
By securing improved market access for Indian goods, expanding opportunities in services and mobility, and deepening collaboration in agriculture, investment and emerging sectors, the Agreement delivers tangible and wide-ranging benefits across the economy.
From farmers and MSMEs to students and skilled professionals, the gains from this Agreement are expected to be broad-based, reinforcing India’s position as a trusted, forward-looking global partner and advancing the vision of a globally integrated Viksit Bharat 2047.
