India-New Zealand FTA Secures Zero-Duty Access, Boosts Jobs and Exports

A key gain for India is New Zealand's commitment to eliminate duties on 100 per cent of its tariff lines, 8,284 lines will be implemented immediately upon entry into force.

This is India's 7th FTA (Free Trade Agreement) in the last few years, after Oman, the UK, the EFTA countries, the UAE, Australia, and Mauritius.

This removes tariffs of up to 10 per cent that earlier applied to nearly 450 lines of key Indian exports, including textiles and apparel, leather products, footwear, carpets, ceramics, automobiles, auto components, engineering goods, pharmaceuticals, plastics, rubber, chemicals, and electrical machinery.

New Zealand's average applied tariff of 2.2 per cent will effectively become zero, significantly improving India's competitiveness in the market

Labour-intensive sectors such as textiles, clothing, leather, and footwear are expected to see strong export growth, alongside advanced manufacturing sectors including engineering, transport equipment, and pharmaceuticals.

Indian agricultural exports like fruits and vegetables, coffee, spices, cereals, and processed foods will also gain from duty elimination on peak tariffs of up to 5 per cent.

India has secured a calibrated outcome in agriculture through tariff rate quotas (TRQs) for sensitive imports such as apples, kiwifruit, Manuka honey, and milk albumin, combined with minimum import prices and seasonal restrictions.

These TRQs are linked to dedicated agri-technology action plans, focusing on productivity enhancement, farmer capacity building, post-harvest practices, and food safety, overseen by a Joint Agriculture Productivity Council. This structure ensures consumer choice while safeguarding domestic farmers

New Zealand has extended its most ambitious services and mobility offer to India, covering 118 services sectors with MFN treatment in 139 sub-sectors.

Notably, India is the first country with which New Zealand has signed annexes on health and traditional medicine services and student mobility.

Indian students will benefit from no numerical caps, guaranteed 20 hours per week work rights, and extended post-study work visas of up to three years for science, technology, engineering and mathematics (STEM) graduates and four years for PhD holders.

A new temporary employment pathway provides 5,000 visas for skilled Indian professionals in IT, engineering, healthcare, education, construction, and iconic Indian occupations such as AYUSH practitioners, yoga instructors, chefs, and music teachers. Additionally, 1,000 young Indians annually will receive multiple-entry working holiday visas

Under the investment chapter, New Zealand has committed to increasing FDI into India by USD 20 billion over 15 years, backed by a rebalancing mechanism. Faster customs clearance, mutual recognition in pharmaceuticals and medical devices, improved IPR protection for Indian GI products, and MSME cooperation further strengthen the agreement.

Strategically, the FTA positions India to deepen its footprint in New Zealand and the wider Oceania region and strengthens bilateral cooperation in a rapidly evolving Indo-Pacific economic landscape.

The FTA negotiations concluded after five formal rounds and multiple inter-sessional discussions, covering both conventional trade areas and new-age disciplines such as investment promotion, MSME cooperation, sustainable development, intellectual property, and cultural and traditional knowledge.

The agreement is expected to enter into force after completion of domestic ratification processes next year.

- ANI