Winning Bizness Desk
Mumbai.India and New Zealand’s free trade agreement (FTA) is expected to come into force from October 19, a government official said on September 15, marking a significant step towards expanding trade, services and investment between the two countries.
The agreement, signed on April 27, is aimed at increasing the flow of goods and services while creating greater investment opportunities for businesses in both markets.
A key gain for Indian exporters will be duty-free access to the New Zealand market. Under the pact, New Zealand has agreed to eliminate import duties on 100% of India’s exports, covering a wide range of products.
Indian exports set for duty-free access
At present, New Zealand imposes duties of up to 10% on several major Indian products. The FTA will remove these duties once the agreement takes effect.
The products expected to benefit include:
- Ceramics
- Carpets
- Automobiles
- Auto components
The move is expected to make Indian products more competitive in the New Zealand market and could encourage exporters to expand their presence there.
New Zealand eyes $20 billion India investment
The agreement also carries a major investment commitment from New Zealand. Under the pact, investments worth $20 billion, or around ₹1.9 lakh crore, are expected to flow into India over the next 15 years.
The investment push is part of the broader effort to deepen economic ties beyond merchandise trade. The agreement seeks to create opportunities for businesses in manufacturing, services and other sectors while strengthening long-term commercial links.
Skilled Indian professionals get new route
The services sector is another important part of the agreement. India has secured market access in several high-value areas, including IT, education, financial services, construction and tourism.
The pact also opens opportunities for professionals working as AYUSH practitioners, yoga instructors, Indian chefs and music teachers.
A new temporary employment entry visa route has been created under the agreement. It will allow up to 5,000 skilled Indian professionals every year to work in New Zealand for as long as three years.
Engineering, healthcare and education are among the sectors expected to see particular opportunities. Indian wine and spirits will also receive duty-free access to the New Zealand market.
Agriculture gets concessions, dairy remains protected
India has opened 70% of its tariff lines to New Zealand under the agreement. Concessions have been provided on products such as apples, kiwifruit and manuka honey.
However, these concessions will come with safeguards including quota limits and minimum import price conditions.
New Zealand will also receive immediate zero-duty access for more than 54% of its exports to India. These include sheep meat, wool, coal and forestry products.
Tariffs on seafood, iron, steel and aluminium scrap will be phased out over the next 10 years.
India, however, has kept several sensitive sectors outside the concession list to protect domestic interests. These include:
- Dairy products such as milk, cream and cheese
- Onions and pulses
- Sugar
- Arms and ammunition
- Certain metals
Decade-long negotiations finally reach agreement
Talks for an India-New Zealand trade agreement began in 2010. After nine rounds of negotiations, the process was suspended in 2015.
The negotiations were revived in March 2025, eventually leading to the announcement of their successful conclusion on December 22, 2025.
The agreement contains 20 chapters covering key areas such as goods, services, rules of origin, technical barriers to trade and customs procedures.
What an FTA means for trade
A free trade agreement is a pact between two countries aimed at reducing or removing tariffs and other barriers on imports and exports.
The broader objective is to increase bilateral trade, attract investment and create better market access for businesses and professionals.
For India, the agreement with New Zealand combines wider export access with new opportunities in services and investment, while retaining protection for several politically and economically sensitive domestic sectors.
