New Delhi: India’s free trade agreement with New Zealand will come into force October 20, allowing 100 per cent of Indian goods, including leather, footwear, apparel and textiles to enter the country at zero import duty in the island country.
The agreement, which will come intro force at 12:01 am on October 20 in India, will also open a 1.4-billion Indian market for New Zealand goods.
Besides, it will expand opportunities for services, professionals, students and agricultural cooperation and facilitates foreign direct investments of USD 20 billion over the next 15 years from New Zealand to India.
Announcing the move, Commerce and Industry Minister Piyush Goyal said the pact aims to increase bilateral trade in goods and services from about USD 2.4 billion to around New Zealand dollar 7 billion or about Rs 35,000 crore, by 2030.
Flagging off heavy earthmoving and construction equipment maker JCB India’s small excavator, which will be exported to New Zealand under the trade pact, Goyal said the company exports 25 per cent of its total production to different countries from India.
“I am giving them a target to increase it to 50 per cent. New Zealand is now the 140th export destination for them,” he said.
GAINS FOR INDIA
New Zealand is giving 100 per cent duty-free market access from Tuesday itself. It covers all tariff lines or product categories and 100 per cent of India’s current exports to New Zealand.
This is the first FTA for India where it receives full duty-free access across all tariff lines from entering into force.
Elimination of import duty would remove the existing tariff disadvantage of pre-FTA rates of up to 10 per cent faced by Indian exporters in the New Zealand market.
The major sectors that would be benefited include fruits and vegetables; coffee, tea, cocoa and spices; cereals; processed foods; textiles and clothing; leather and footwear; pharmaceuticals; engineering goods; marine products; plastics and rubber.
INDIA PROTECTED SENSITVE SECTORS
India’s exclusion list primarily includes products considered sensitive from a domestic perspective.
The major categories are dairy products (milk, cream, whey, yoghurt, cheese); animal products (other than sheep meat); vegetable products such as onions, chana, peas, corn, almonds); sugar and artificial honey; animal, vegetable or microbial fats and oils.
The list also includes arms and ammunition; gems and jewellery (Precious metals and finished jewellery products); copper and copper articles (cathodes, cartridges, rods, bars, coils); and aluminium and aluminium articles (ingots, billets, wire, rods, bars).
INDIA’S GAINS IN SERVICES
New Zealand has agreed to open up 118 services sectors or sub-sectors to Indian service providers, offering them better access to its market under the FTA. These include IT, professional services, telecommunications, construction, education, financial services, and tourism.
Indian companies and professionals may now find it easier to provide services in New Zealand.
Under the FTA, New Zealand has agreed to allow certain Indian professionals and business people to work or visit the country for specific periods.
Employees transferred within the same company can stay for up to three years, while business visitors and workers installing or servicing equipment can stay for up to 90 days in a 12-month period. Contractual service providers and independent professionals can stay for up to 12 months.
The FTA creates a new temporary employment entry visa pathway for skilled Indians, with a quota of 5,000 visas at any time for stays of up to three years. It covers IT, engineering, construction, education, healthcare, and Indian occupations such as yoga instructors, chefs, music teachers, and Ayush practitioners.
In addition, the agreement has established an agriculture productivity partnership to strengthen cooperation in agriculture, with dedicated action plans for kiwifruit, apples and honey aimed at improving productivity, and quality in India.
GAINS FOR NEW ZEALAND
India is giving tariff concessions on 70 per cent of its tariff lines, covering about 95 per cent of the current bilateral trade value. The remaining 29.97 per cent of the lines have been kept in the exclusion list.
India is giving duty based quota for apples, kiwifruit, manuka honey and albumins, along with minimum import price (MIP) provisions and other safeguard measures.
This approach ensures calibrated imports while protecting the interests of domestic farmers.
Speaking at the event, New Zealand Trade and Investment Minister Todd McClay said the agreement would create opportunities for exporters across key sectors.
“Once fully implemented, 95 per cent of New Zealand’s current exports to India will benefit from tariff elimination or substantial tariff reductions, creating new opportunities across many of our key export sectors,” he said.
Commerce Secretary Rajesh Agrawal said the challenge was to turn the agreement’s provisions into tangible gains.
“The job is now to see how we are able to take this FTA and translate this opportunity into actual benefits for our people,” he said.
The pact also provides for customs clearance within 48 hours for cargo and 24 hours for express and perishable consignments. Digital certification and self-certification of rules of origin for eligible status holders are intended to reduce procedural delays and compliance costs.
Bilateral trade declined about 11 per cent to USD 1.15 billion in 2025-26 from USD 1.3 billion in the previous fiscal year. India’s exports stood at USD 566.51 million, while imports were USD 589.1 million, resulting in a meagre trade deficit of USD 22.59 million for India.
