India, New Zealand seal landmark Free Trade Agreement, opening new avenues for trade, talent and investment
New Delhi, December 22. India and New Zealand have concluded a comprehensive and forward-looking Free Trade Agreement (FTA), marking a significant economic and strategic milestone in India’s engagement with the Indo-Pacific region. The agreement, finalised under the leadership of Prime Minister Narendra Modi, is among the fastest-concluded FTAs by India and aligns with the national vision of Viksit Bharat 2047.
Negotiations for the FTA were formally launched on March 16, 2025, during a meeting between Union Commerce and Industry Minister Piyush Goyal and New Zealand’s Minister for Trade and Investment Todd McClay. The deal was wrapped up after five intensive rounds of negotiations, supplemented by multiple in-person and virtual intersessional discussions.
According to a statement issued by the Ministry of Commerce and Industry on December 22, the agreement establishes a high-quality economic partnership aimed at boosting employment, enhancing skill mobility, promoting trade-and-investment-led growth, improving agricultural productivity through innovation, and increasing the participation of micro, small and medium enterprises (MSMEs) to strengthen long-term economic resilience.
Announcing the conclusion of the pact, Minister Piyush Goyal said the FTA is centred on people and opportunities, benefiting farmers, entrepreneurs, students, women and innovators. He noted that the agreement would help raise agricultural productivity and farmer incomes, expand market access for Indian businesses, and provide global learning and employment opportunities for Indian youth.
Under the FTA, New Zealand will eliminate tariffs on 100 percent of its tariff lines, granting duty-free access to all Indian exports. This is expected to significantly enhance the competitiveness of labour-intensive sectors such as textiles, apparel, leather, footwear, marine products, gems and jewellery, handicrafts, engineering goods and automobiles, thereby supporting workers, artisans, women, youth and MSMEs and integrating them more deeply into global value chains.
India has also secured New Zealand’s most ambitious services commitments to date, covering high-value sectors including IT and IT-enabled services, professional services, education, financial services, tourism, construction and other business services. These commitments are expected to create substantial new opportunities for Indian service providers and high-skilled employment.
Commerce Secretary Rajesh Agrawal described the pact as a “new-generation trade agreement” built around tariffs, agricultural productivity, investment and talent mobility, with complementarity at its core. He said the agreement leverages India’s export strengths and services capabilities, while providing New Zealand with more predictable access to India’s large and growing market.
A key feature of the agreement is a future-ready mobility framework that enhances opportunities for Indian professionals, students and youth. Provisions include improved entry and stay norms, work rights during studies, post-study work pathways, dedicated visa arrangements and a working holiday visa framework, strengthening people-to-people ties.
The FTA also introduces a new Temporary Employment Entry Visa pathway for Indian professionals in skilled occupations, with a quota of 5,000 visas at any given time and stays of up to three years. This pathway covers professions such as AYUSH practitioners, yoga instructors, Indian chefs and music teachers, as well as high-demand sectors like IT, engineering, healthcare, education and construction.
In agriculture, the two sides have agreed on dedicated Agri-Technology Action Plans for kiwifruit, apples and honey, focusing on productivity enhancement, research collaboration, quality improvement and value-chain development. Initiatives include Centres of Excellence, improved planting material, capacity building and technical support for orchard management, post-harvest practices and food safety, aimed at boosting farmer incomes.
The agreement significantly deepens the investment partnership, with New Zealand committing to facilitate investments worth $20 billion into India over the next 15 years. These investments are expected to support manufacturing, infrastructure, services, innovation and employment under the Make in India initiative, while Indian companies are likely to benefit from greater access to New Zealand and Pacific Island markets.
The FTA also provides a boost to pharmaceuticals and medical devices by enabling faster regulatory access through mutual acceptance of GMP and GCP inspection reports from comparable regulators such as the US FDA, EMA and UK MHRA, reducing compliance costs and expediting approvals.
New Zealand has further committed to enhanced protection of Geographical Indications (GI), including amending its laws to facilitate the registration of Indian wines, spirits and other goods within defined timelines. Cooperation has also been agreed in areas such as AYUSH, culture, fisheries, audiovisual tourism, forestry, horticulture and traditional knowledge systems, promoting India’s wellness and medical value travel ecosystem globally.
Beyond tariff liberalisation, the agreement addresses non-tariff barriers through stronger regulatory cooperation, transparency, streamlined customs procedures, and enhanced sanitary and phytosanitary and technical standards, ensuring that tariff concessions translate into effective market access.
Bilateral economic ties between the two countries have been steadily expanding. Merchandise trade reached $1.3 billion in 2024-25, while total trade in goods and services stood at about $2.4 billion in 2024, with services trade accounting for $1.24 billion, led by travel, IT and business services.
The India-New Zealand FTA is the third such agreement concluded this year and represents a new-generation trade partnership, reinforcing India’s journey towards becoming a globally competitive, inclusive and resilient economy under Viksit Bharat 2047.
