India and New Zealand are set to formally sign their long-awaited Free Trade Agreement (FTA) on April 27, 2026, at Bharat Mandapam in New Delhi. The agreement will be signed by Union Commerce and Industry
Minister Piyush Goyal and New Zealand’s Trade and Investment Minister Todd McClay, following an earlier announcement by Prime Minister Christopher Luxon.
The deal has moved at an unusually fast pace—launched on March 16, 2025, and concluded by December 22, 2025—making it one of India’s quickest trade negotiations to reach the signing stage. The agreement will now require ratification in both countries before coming into force, likely later in 2026.
India Secures 100% Duty-Free Access
Under the pact, all 8,284 Indian export products will receive duty-free access to the New Zealand market from day one of implementation. Previously, Indian goods faced an average tariff of 2.2%, with duties of up to 10% on certain categories such as textiles, ceramics, and automobiles.
Key sectors benefiting immediately include textiles and apparel, leather and footwear, pharmaceuticals, engineering goods, chemicals, electronics, and agricultural products like spices, coffee, and cereals. Tariffs on leather products, for instance, will drop from 5% to zero, providing a significant boost to export hubs such as Agra.
The agreement also simplifies regulatory processes for India’s pharmaceutical and medical devices sector. New Zealand will accept inspection reports from global regulators such as the US FDA and European Medicines Agency, reducing compliance costs and speeding up market entry.
In a first-of-its-kind move for New Zealand, the deal includes a dedicated chapter recognising India’s traditional medicine systems under AYUSH, alongside Māori health practices.
Market Access and Opportunities for New Zealand
India has offered tariff concessions on 70.03% of its tariff lines, covering 95% of bilateral imports from New Zealand. Key exports expected to benefit include wool, wine, wood, coal, and fresh produce such as avocados and blueberries.
The agreement also outlines cooperation in agriculture and allied sectors, including horticulture, forestry, livestock, fisheries, and apiculture. A dedicated Agri-Technology Action Plan will support Indian farmers with expertise in areas such as kiwi, apple, and honey production.
Sensitive Sectors Remain Protected
India has excluded 29.97% of its tariff lines—representing about 5% of import value—from the agreement to safeguard domestic interests. Sensitive sectors kept outside the deal include dairy products, key agricultural commodities like onions and pulses, edible oils, sugar, and certain industrial goods such as metals and defence-related items.
Mobility, Investment and Services Boost
The FTA includes a significant mobility component, with New Zealand opening a pathway for Indian professionals through a temporary visa programme. Around 1,667 visas will be issued annually for three years, with a cap of 5,000 workers at any given time.
New Zealand has also committed to facilitating $20 billion in foreign direct investment into India over the next 15 years. Priority sectors are expected to include infrastructure, renewable energy, agriculture, and technology.
The agreement extends Most-Favoured Nation provisions across nearly 139 services sub-sectors, including finance, tourism, digital services, and creative industries. It also includes dedicated support for MSMEs, helping them access trade information, build export readiness, and integrate into global value chains.
Trade Targets and Strategic Importance
Bilateral trade between the two countries currently stands at around $1.3 billion (2024–25), with a target to increase this to $5 billion within five years of the agreement coming into force.
The FTA is also strategically significant for India, offering access to a high-income Pacific market while serving as a gateway to the wider Oceania region. Compared to longer negotiations such as the EU deal, the relatively swift nine-month timeline reflects lower friction and strong political alignment between the two countries.
Part of India’s Broader FTA Push
The India–New Zealand agreement adds to a series of recent trade deals signed by India, including those with the UAE, Australia, the United Kingdom, and the EFTA bloc, as well as ongoing engagements with the European Union.
Beyond tariffs, the agreement reflects a broader, next-generation FTA framework, covering services, digital cooperation, skills mobility, and cultural exchange. Once ratified, businesses on both sides will need to realign supply chains and compliance processes to fully benefit from the expanded market access.
