In New Zealand, the agreement will undergo scrutiny by the Parliament’s Foreign Affairs, Defence and Trade Committee. This process includes a national interest analysis and public consultation, after which the committee will submit its report to Parliament for final ratification. The entire procedure is expected to take at least six months.
New Zealand Prime Minister Christopher Luxon had earlier described the pact as a “once in a generation agreement,” emphasizing that India’s emergence as the world’s third-largest economy presents unprecedented opportunities for New Zealand exporters to access a vast market of 1.4 billion people.
Negotiations for the agreement resumed in March 2025 after a decade-long pause and were concluded by December 2025, making it one of India’s fastest trade negotiation processes. The agreement has also received bipartisan support from major political parties in New Zealand.
According to Agneshwar Sen, Trade Policy Leader at EY India, New Zealand has committed to eliminating duties on 100 percent of its tariff lines immediately upon the agreement’s implementation, covering all 8,284 categories. This provision ensures that Indian exports, including textiles, apparel, leather, pharmaceuticals, machinery, and auto components, will enter the New Zealand market duty-free. The removal of tariffs, which previously averaged 2.2 percent and included rates as high as 10 percent on labor-intensive goods such as clothing and leather products, is expected to significantly boost Indian exports.
The agreement also extends beyond goods to services and mobility. It introduces new pathways for Indian professionals in sectors such as information technology, healthcare, engineering, and education. Additionally, a fast-track mechanism will allow Indian food processors to import New Zealand ingredients duty-free for processing and re-export, supporting India’s ambition to emerge as a global food hub. With Indian merchandise exports to New Zealand already showing an upward trend, the FTA is expected to provide policy certainty and sustained market access.
Under the agreement, Indian exporters will gain 100 percent duty-free access to the New Zealand market across all 8,284 export products. Initially, approximately 70 percent of Indian goods, including leather, handloom, and handicrafts, will benefit from immediate duty-free entry.
On the other hand, New Zealand will eliminate or reduce tariffs on most of its exports to India, including wool, wood, coal, wine, and fruit, thereby strengthening its agricultural and export sectors. However, India has excluded sensitive sectors such as dairy, onions, sugar, spices, and edible oils from tariff concessions to safeguard domestic farmers and industries.
The agreement also outlines a significant investment commitment, with New Zealand pledging to invest up to 20 billion dollars in India over the next 15 years. These investments are expected to span services, manufacturing, and technology sectors, further deepening economic ties.
In terms of mobility, the FTA provides visa pathways for 5,000 Indian professionals annually, along with 1,000 work and holiday visas each year. These opportunities will be available across sectors including information technology, healthcare, construction, and education. Indian students and young professionals will also benefit from expanded post-study work provisions.
Despite concerns regarding potential dairy imports, the government has assured that the domestic dairy industry will remain protected. Ravin Saluja, Director of Sterling Agro Industries Limited, noted that while New Zealand accounts for nearly one-third of global dairy trade, the agreement does not permit direct milk imports into India. However, it may encourage Indian companies to enhance quality and performance standards.
Agneshwar Sen further emphasized that India secured the agreement without compromising its most sensitive sectors. Key agricultural commodities, including dairy, edible oils, sugar, spices, and onions, have been explicitly excluded from India’s concession list. India’s tariff concessions are strategically focused on inputs such as sheep meat, wool, coal, and forestry products, which support domestic manufacturing rather than threaten local industries.
Once implemented, the India-New Zealand Free Trade Agreement is expected to transform bilateral trade dynamics, enhance goods and services exchange, and strengthen economic and strategic ties between the two countries.
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