New Zealand Parliament passes India trade deal: 95% of its exports to get tariff relief
New Zealand's Parliament on Wednesday passed legislation to implement its free trade agreement (FTA) with India, a pact that will eliminate or significantly reduce tariffs on about 95 per cent of New Zealand's exports to India once it is fully in force.
The bill cleared the House by 93 votes to 29, with support from the opposition Labour Party. More than half of the products covered will become duty-free from the day the agreement takes effect.
"For exporters, the benefits are immediate and substantial. From day one, 57 per cent of New Zealand's exports to India will become duty-free," Trade Minister Todd McClay said in a statement.
"Once fully implemented, tariffs are eliminated or significantly reduced on 95 per cent of our exports. That means real savings and real opportunities. The kiwifruit industry alone expects to save around $125 million in tariffs over five years," he added.
Mr McClay said the agreement also provides for faster border clearance and preferential access to India's "fast-growing middle class", which he said is demanding high-quality food, fibre, technology, education, tourism and professional services. He described the deal as "future-proofed" through most-favoured-nation commitments covering wine and key services sectors.
Negotiations on the agreement were announced in March 2025 and the deal was signed in April. The Minister said the government expects it to enter into force this year, "delivering on our promise to complete an FTA with India this term".
The concessions are not one-sided. All Indian goods will receive duty-free access to the New Zealand market, and Wellington has agreed to invest $20 billion in India over the next 15 years, according to the terms outlined by both sides.
Mr McClay said exporters would be able to use the agreement to build new relationships, sell more of New Zealand's products and contribute to the goal agreed by Prime Minister Narendra Modi and New Zealand Prime Minister Christopher Luxon of doubling two-way trade by 2030.
Two-way trade between the two countries totalled NZ$3.99 billion (about US$2.29 billion) in the year to June 2026, with India ranking as New Zealand's ninth-largest market for goods and services exports. The figures underline how much scope both governments see for expansion.
For New Zealand, the agreement is part of a wider effort to diversify its exports beyond traditional markets. For India, it adds to a series of trade pacts signed in recent years with partners including the United Arab Emirates, Australia and the United Kingdom, as New Delhi seeks deeper access to developed markets for its goods and services.
The legislation will take effect after both countries complete their respective ratification procedures. Until that process concludes, the tariff changes remain contingent and the agreement does not yet bind either side.
(With inputs from Reuters)
