India-New Zealand FTA faces first challenge — Here's why NZ's ruling coalition member says they are opposing deal

Prime Minister Narendra Modi and New Zealand PM Christopher Luxon on 22 December jointly announced that both countries have concluded discussions on a comprehensive Free Trade Agreement (FTA).

However, in a lengthy post on social media platform X (formerly Twitter), Winston Peters, the New Zealand coalition government's Minister of Foreign Affairs, Racing, and Rail, and leader of the New Zealand First party has said they oppose the proposed deal.

The joint statement called the development “a major economic and strategic milestone” for India in the Indo-Pacific region. The deal is likely to be signed in three months and to be implemented in 2026.

India-New Zealand FTA faces first challenge

“New Zealand First is regrettably opposed to the India Free Trade Agreement announced today,” Peters declared on X, on 22 December, adding that the party does not see the announced FTA as “free or fair”.

“Regrettably, this is a bad deal for New Zealand. It gives too much away, especially on immigration, and does not get enough in return for New Zealanders, including on dairy,” it added.

Deal rushed, not good for New Zealand, says Peters

Peters further said that his party had urged the coalition partner to “not rush” into concluding a “low-quality” deal with India, and instead “use all three years of this Parliamentary cycle in order to get the best possible deal”.

“National preferred doing a quick, low-quality deal over doing the hard work necessary to get a fair deal that delivers for both New Zealanders and Indians. While New Zealand is completely opening its market to Indian products under this deal, India is not reducing the significant tariff barriers currently facing our major dairy products. This is not a good deal for New Zealand farmers and is impossible to defend to our rural communities,” he claimed.

Dairy, immigration the sticking points?

Peters also feels that the India FTA “would be New Zealand’s first trade deal to exclude our major dairy products — including milk, cheese and butter”, which comprised 30% of their total goods exports in November 2025. He also criticised the government for making “serious concessions to India in areas that have nothing to do with two-way trade — but rather relate to encouraging the movement of people from India to New Zealand and New Zealand investment in India”.

“On a per capita basis, National has offered far greater access for India to our labour market than did Australia or the United Kingdom to secure their FTAs. This is deeply unwise given New Zealand’s current labour market conditions, with too many New Zealanders in unemployment or doing it tough economically,” he added.

Peters also sought to assure that his party is “deeply committed to the advancement of the India-New Zealand relationship, which is in our country’s strategic interests”.

India-New Zealand FTA: Key Highlights

The India-New Zealand FTA is among India’s fastest-concluded trade deals. With discussions started in March 2025, the agreement was concluded after five rounds of negotiation rounds and several in-person and virtual sessions. It promises:

• Zero Duty market access on 100% of India’s exports.
• India has offered tariff liberalisation in 70% lines covering 95% of New Zealand-India Bilateral trade.
• Dedicated quota of Temporary Employment Entry visa for 5,000 professionals and 1,000 Work and Holiday Visas.
• New Zealand has committed to facilitate investments of $20 billion into India over the next 15 years.

• Establishment of Agricultural Productivity Partnerships through Centres of Excellence by New Zealand for Apples, Kiwifruit, and Honey to boost productivity.
• Duty free inputs for India's Manufacturing Sector: Wooden logs, coking coal, waste and scraps of metals.
• Cooperation has been agreed in AYUSH, culture, fisheries, audio visual tourism, forestry, horticulture and traditional knowledge systems.
• Apart from tariff liberalisation, the FTA includes provisions to address non-tariff barriers through enhanced regulatory cooperation.

(With inputs from PTI)