India and New Zealand Seal Historic Free Trade Agreement (FTA)
India and New Zealand Seal Historic Free Trade Agreement (FTA)
New Delhi, December 22, 2025 – In a major milestone for bilateral relations, Prime Minister Narendra Modi and New Zealand Prime Minister Christopher Luxon announced the successful conclusion of negotiations for a comprehensive and mutually beneficial Free Trade Agreement (FTA) during a telephone conversation on Monday.
This landmark deal was finalised in a record nine months since formal talks began in March 2025. Under the agreement, all Indian exports will receive zero-duty access to New Zealand, while India will eliminate or reduce tariffs on approximately 95% of New Zealand’s exports, with more than half becoming duty-free immediately upon entry into force.
Key Highlights of the India-New Zealand FTA:
- Market Access for India: All Indian products, especially in labour-intensive sectors such as textiles, apparel, leather, footwear, marine products, gems and jewellery, handicrafts, engineering goods, automobiles, and pharmaceuticals, will gain duty-free entry into New Zealand.
- Benefits for New Zealand: Significant tariff reductions on key exports like wool, wine, kiwifruit, apples, timber, and forestry products. The deal is projected to boost New Zealand’s annual exports to India by $1.1–1.3 billion.
- Protection for Sensitive Sectors: India has protected its farmers by excluding sensitive agricultural items, including dairy, milk products, cheese, onions, sugar, spices, edible oils, and rubber, from market access commitments.
- Trade and Investment Targets: Bilateral merchandise trade reached about $1.3 billion in FY 2024-25, with total goods and services trade at $2.4 billion. The FTA aims to double bilateral trade within five years. New Zealand has committed to facilitating $20 billion in investments into India’s manufacturing, infrastructure, and innovation sectors over the next 15 years.
- Strengthening People-to-People Ties: New visa pathways for Indian professionals, skilled workers, and students, including working holiday visas. The agreement includes wide-ranging commitments in services sectors like IT, education, tourism, and professional services – New Zealand’s most ambitious services package in any FTA to date.
Prime Minister Modi called the agreement “historic and ambitious,” stating, “The India-New Zealand partnership will reach new heights. The FTA lays the foundation for doubling bilateral trade in the next 5 years. India welcomes investments worth over USD 20 billion from New Zealand across diverse sectors.”
Prime Minister Luxon described it as a symbol of strong friendship between the two nations, creating more jobs and opportunities while opening access to India’s rapidly growing market.
This marks India’s third FTA in 2025, following deals with the United Kingdom and Oman, reinforcing New Delhi’s strategy to diversify exports and build resilient global partnerships in line with the vision of Viksit Bharat @2047.
The agreement is expected to be formally signed in the first half of 2026 after legal review and will enter into force soon thereafter.
This FTA not only boosts economic cooperation but also deepens the longstanding friendship between the two democracies – another strong step towards Atmanirbhar Bharat!
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