India–New Zealand FTA: What's cheaper, what's protected, who benefits

India and New Zealand will sign a fast-tracked free trade agreement in New Delhi on April 27. The pact opens duty-free access, work visas, services and investment while shielding sensitive Indian sectors.

In Short

• India gets duty-free access for 8,284 products in NZ market from day one
• NZ gains access to 70% of Indian tariff lines, benefits wool, wine, fruits sectors
• Agreement offers 1,667 annual work visas, targets $5 billion trade in 5 years

India and New Zealand are set to sign a trade agreement that could open up new export markets, ease business rules and create more job opportunities across sectors.

The Free Trade Agreement (FTA), to be signed on April 27 in New Delhi, is being seen as a fast-tracked deal that goes beyond goods to include services, mobility and investment.

The agreement will be signed by Union Commerce Minister Piyush Goyal and New Zealand Trade Minister Todd McClay. Talks for the pact began in March 2025 and were wrapped up within nine months, making it one of the quickest trade deals India has closed.

WHAT INDIA GETS

One of the biggest gains for India is complete duty-free access for all its 8,284 export products in the New Zealand market from day one.

Earlier, Indian exports faced an average tariff of 2.2%, with some labour-heavy sectors like textiles and leather seeing duties of up to 10%. These will now drop to zero.

This is expected to benefit sectors such as garments, leather, engineering goods, chemicals, electronics and food products.

Agneshwar Sen of EY India pointed out that this removes a key cost barrier for exporters.

“This means Indian goods in textiles, apparel, leather and machinery will enter New Zealand duty-free, including products that earlier faced up to 10% tariffs,” he said.

The pharmaceutical sector will also gain easier access, with New Zealand agreeing to accept inspection reports from global regulators. This will reduce repeated checks and cut compliance costs.

WHAT NEW ZEALAND GETS

India has opened 70.03% of its tariff lines to New Zealand, covering 95% of current imports.

New Zealand exporters will benefit in areas such as wool, wine, wood, coal and fruits like avocados and blueberries.

The deal also includes cooperation in agriculture, including a special agri-technology plan to support Indian farmers with inputs in kiwi, apple and honey production.

WHAT INDIA HAS PROTECTED

At the same time, India has kept nearly 30% of its tariff lines outside the deal to protect sensitive sectors.

These include dairy products, edible oils, sugar, vegetables like onions and pulses, and sectors such as gems and jewellery and metals.

Sen said this balance was important.

“India has secured this without compromising its most sensitive sectors. Dairy, edible oils and key agricultural products are explicitly excluded,” he said.

MOBILITY AND JOB OPPORTUNITIES

The agreement also opens a new pathway for Indian professionals.

New Zealand will offer 1,667 temporary work visas each year for an initial three-year period, with a cap of 5,000 people at any given time.

This is expected to benefit professionals in IT, healthcare, engineering and education.

Industry bodies say the agreement could support both exports and jobs.

Rajeev Juneja, President of PHDCCI, said the deal provides broad-based benefits.

“It delivers 100% zero-duty market access for Indian exports, and a framework that supports students, professionals and MSMEs,” he said.

Dr Ranjeet Mehta, CEO of PHDCCI, said the agreement goes beyond trade.

“It combines trade with investment and technology cooperation, while lowering input costs and improving competitiveness,” he said.

New Zealand has committed to invest $20 billion in India over the next 15 years, with focus on infrastructure, renewable energy, agriculture and technology.

The agreement also opens up around 139 services sectors, including finance, tourism and digital services.

It includes support for MSMEs, helping them access trade information and connect with global value chains.

TRADE TARGET AND WHAT IT MEANS

Trade between the two countries currently stands at about $1.3 billion. The target is to scale this up to $5 billion within five years.

Commerce Minister Piyush Goyal said the agreement should be seen as a wider opportunity.

“The FTA is an opening of both doors and minds. Industry must think beyond the ordinary and use the full scope of the agreement,” he said.

The deal shows a shift in India’s trade strategy, focusing not just on tariffs but also on services, mobility and investment.

For businesses, the key will be how quickly they can use these new openings. For now, the agreement sets the stage for deeper economic ties between the two countries.

- Ends