New Zealand's market has opened up for India. The India-New Zealand Free Trade Agreement (FTA) comes into effect from Monday. Union Commerce and Industry Minister Piyush Goyal announced this on Monday. Under the agreement, Indian goods will get duty-free access to the New Zealand market, while several New Zealand products will get easier access to the Indian market at lower duties. The agreement also includes an investment commitment of US$20 billion, or around ₹1.92 lakh crore, along with cooperation in the agriculture sector.
India and New Zealand signed the free trade agreement on April 27. At that time, Union Commerce Secretary Rajesh Agarwal had said that the agreement was likely to come into effect in October.
New Zealand Prime Minister Christopher Luxon said on Monday that the agreement had been finalized after getting approval from Parliament. He said the deal was now ready to come into effect.
In a post on X, Luxon said that nearly three years ago he had promised that, if elected, the National Party would complete a free trade agreement with India during its first term. He said the agreement would create more opportunities for exporters, help businesses grow and create more jobs and higher incomes in New Zealand.
The bill related to the agreement was passed by the New Zealand Parliament on September 16. A total of 93 members voted in favour of the bill, while 29 voted against it. Welcoming the approval, Luxon said the agreement would give New Zealand better access to the Indian market and support the country's economic growth. He added that many people had earlier said that an FTA with India would not be possible, but the agreement had now received final approval from Parliament.
Under the deal, New Zealand has committed US$20 billion in investment in India. Around 70.03% of New Zealand products exported to India will get duty-free access. India has kept the remaining 29.97% of products outside these benefits. These include dairy products, several agricultural products, sugar, certain metals and other sensitive items.
Duties on timber, wool, mutton and raw hides will be removed immediately. Tariffs on several other products will be reduced gradually over three, five, seven or ten years. Duties will also be lowered on products such as wine, medicines, polymers and some aluminium, iron and steel items. Products including manuka honey, apples, kiwifruit and albumin will come under quota-based tariff rules.
The agreement also includes cooperation in agriculture, mainly in areas such as kiwifruit, apples and honey. India and New Zealand will work together on seedlings, research, technical support, orchard management, post-harvest support, supply chains and food safety. The aim is to improve productivity and strengthen agricultural cooperation between the two countries.
The agreement also covers the services sector and includes provisions related to Most-Favoured-Nation treatment in several service categories.
The FTA will also create new opportunities for Indian professionals and skilled workers. Under a temporary employment visa system, up to 5,000 skilled Indians will be allowed to stay and work in New Zealand for up to three years. It will cover Ayurvedic doctors, yoga instructors, Indian chefs and music teachers, along with professionals working in IT, engineering, healthcare, education and construction.
Under the Working Holiday Visa programme, up to 1,000 young Indians every year will be able to travel to New Zealand and stay for up to 12 months.
Indian students will also get benefits under the agreement. Eligible students will be allowed to work up to 20 hours a week while studying. They will also be able to get post-study work visas depending on their qualifications.
Apart from trade, jobs and education, the agreement also includes cooperation in investment, research and innovation, technology, skills, renewable energy, digital services and infrastructure.