The India-New Zealand free trade agreement (FTA) signed on Monday is the latest in a series of bilateral pacts India has struck. Once operationalized, it will allow India zero-duty access for all goods along with easier mobility for professionals to work in New Zealand, which has also committed to invest $20 billion in India over many years.
In return, New Zealand will get calibrated access to Indian markets across 70% of tariff lines, covering 95% of its exports. Sensitive sectors such as dairy have been kept out, although with tariffs slashed, New Zealand kiwis may taste sweeter to Indians.
Overall, the pact is another shot in the arm for New Delhi’s strategy of going for bilateral economic deals rather than join big trade groupings. Trade in goods and services with New Zealand stood at $2.4 billion in 2024. That’s small, but therein lies an opportunity to expand.
Given its advanced quality standards, enhanced trade with New Zealand may help Indian exporters get more competitive on a front other than cost. As with other deals, the emphasis seems on so-called complementarities rather than head-on competition. It’s part of the cautious approach taken by New Delhi.