NEW DELHI (AP) — India and New Zealand have struck a free trade deal, officials said Monday, seeking to deepen economic ties and boost growth at a time of rising global trade uncertainty.
The move comes as New Delhi accelerates efforts to diversify export destinations as part of a broader strategy to offset the impact of high U.S. import tariffs.
India and New Zealand are expected to formally sign the agreement in the first quarter of next year after making legal changes to the negotiation text, India’s chief negotiator Petal Dhillon told reporters.
The India-New Zealand trade pact, negotiated for nine months, aims to lower tariffs, ease regulatory barriers and expand cooperation on goods, services and investment.
This underscores India’s efforts to lock in trading partnerships outside traditional markets as global business faces pressure from unpredictable tariffs and geopolitical tensions, slowing growth and rising protectionism.
As part of the deal, all Indian exports to New Zealand will receive zero-tariff export access, while Wellington will receive tariff concessions and market access for about 70 per cent of New Delhi’s tariff lines, covering 95 per cent of its exports in a phased manner, officials said.
India’s major industries that will benefit from duty-free exports include textiles, clothing, engineering products, leather and footwear, and seafood, while New Zealand’s major beneficiary industries will be horticulture, timber exports, and wool.
As part of the deal, New Zealand has committed to invest $20 billion in India over 15 years, India’s trade ministry said.
New Delhi has excluded dairy products such as milk, cream, whey, yogurt and cheese as well as animal and plant products such as goat meat, onions and almonds from the agreement, citing “domestic sensitivities”.
Bilateral trade between India and New Zealand remains small compared with New Delhi’s larger partners, but officials say the agreement has strong growth potential. Trade Minister Rajesh Agarwal said two-way trade, including goods and services, will reach $2.4 billion by 2024, with both sides hoping to double that figure in about five years.
New Zealand Prime Minister Christopher Luxon said in a post on Monday that he spoke to his Indian counterpart Narendra Modi about the end of the talks. He said New Zealand’s exports to India were expected to increase by $1.1 billion to $1.3 billion a year over the next two decades as a result of the agreement.
“Boosting trade means more New Zealand jobs, higher wages and more opportunities for hardworking New Zealanders,” he said.
A statement from Modi’s office said the trade agreement will be a catalyst for greater trade, investment, innovation and shared opportunities between the two countries.
