India, New Zealand Sign FTA; Indian Exports To Get Duty-Free Access, New Zealand To Invest $20 Billion

India and New Zealand today signed a landmark comprehensive Free Trade Agreement (FTA), more than a decade after negotiations first began in 2010. The pact, described by New Zealand Prime Minister Christopher Luxon as a once-in-a-generation agreement, was formalized in New Delhi in the presence of Union Commerce and Industry Minister Piyush Goyal and New Zealand's Minister for Trade and Investment Todd McClay.

The signing ceremony took place at Bharat Mandapam, with both ministers hailing the agreement as a defining moment in bilateral ties.

Under the agreement, 100 percent of Indian exports to New Zealand will receive duty-free access from the date the pact comes into force. This includes labour-intensive sectors such as textiles, leather, plastics, engineering goods, and handloom products.

The Confederation of Indian Textile Industries (CITI) welcomed the move, stating that the FTA will help Indian exporters reduce dependence on select markets and move up the value chain . The leather sector in Agra, which accounts for approximately 75 per cent of India's leather footwear production, stands to gain significantly as tariffs on leather and footwear will drop from 5 per cent to zero .

India has also secured commitments in key services areas including IT, education, financial services, tourism, and construction, alongside a new temporary employment visa pathway allowing up to 5,000 Indian professionals to work in New Zealand for up to three years.

New Zealand To Gains Access To Indian Market

For New Zealand, the agreement provides immediate duty-free access to over 54 per cent of its exports to India, including sheep meat, wool, coal, and forestry products. Tariffs on several other goods, such as seafood, iron, steel, and aluminium, will be reduced or phased out over time.

However, India has protected sensitive sectors to safeguard domestic interests. No concessions have been granted on dairy products, including milk, cream, yoghurt, cheese, and whey or on items such as onions, sugar, edible oils, and rubber. Sensitive agricultural products including apples, kiwifruit, and manuka honey will be protected through tariff-rate quotas and safeguard mechanisms.

A key feature of the agreement is New Zealand's commitment to invest $20 billion in India over 15 years, spanning manufacturing, infrastructure, services, innovation, and job creation . Ministry officials have indicated that if New Zealand fails to meet these investment targets, India retains the right to withdraw or suspend tariff concessions granted to New Zealand products.

Addressing the India-New Zealand Business Forum, Minister Goyal said the FTA reflects the growing strategic importance of India in world geopolitics and sets the stage for doubling bilateral economic trade . He described the agreement as the beginning of a "new chapter" in India–New Zealand economic relations .

"This is far more than a tariff agreement. It is a comprehensive framework encompassing market access, agricultural productivity, investment, talent mobility, and people-to-people ties," Goyal said at an industry engagement in Agra on the eve of the signing.

Prime Minister Luxon, in a video post on social media platform X, said India's rise to become the world's third-largest economy would offer Kiwi exporters "unprecedented access" to a market of 1.4 billion people.

Minister McClay reaffirmed that India is a strategic priority for New Zealand and described this as the highest quality FTA New Zealand has concluded.