India-New Zealand FTA: Why Kiwi Politicians Are Unhappy With ‘Historic Free Trade Agreement’

The India-New Zealand FTA guarantees doubling bilateral trade over the next five years, as well as an investment of $20 billion in India from New Zealand over the next 15 years.

India and New Zealand have concluded a historic Free Trade Agreement on 22nd December, reflecting shared ambition to deepen economic ties between our two countries. Prime Minister Narendra Modi and New Zealand Prime Minister Christopher Luxon held a telephonic conversation on 22nd December, announcing the conclusion of the landmark Free Trade agreement between the two Nations in a span of nine months.

Both leaders agreed that the FTA would catalyze greater trade, investment, innovation, and shared opportunities between the two countries. The India-New Zealand FTA guarantees doubling bilateral trade over the next five years, as well as an investment of $20 billion in India from New Zealand over the next 15 years.

Although the Leader of New Zealand First and the New Zealand Minister of Foreign Affairs, Winston Peters, opposed the Free Trade Agreement. In a ‘x’ post, the leader opposed the India-New Zealand FTA, and wrote ‘New Zealand First is regrettably opposed to the India Free Trade Agreement announced today. He said that the India-New Zealand Free Trade Agreement is neither free nor fair.

Why Opposition To The FTA

Notably, New Zealand’s biggest sector is dairy, and the same is one of the biggest livelihood source in India too. To protest farmers’ interests, India has kept the dairy sector out of the FTA ambit and the Kiwi politicians are now protesting against this and other clauses.

"We consider the India-New Zealand Free Trade Agreement to be neither free nor fair...Regrettably, this is a bad deal for New Zealand. It gives too much away, especially on immigration, and does not get enough in return for New Zealanders, including on dairy...While New Zealand is completely opening its market to Indian products under this deal, India is not reducing the significant tariff barriers currently facing our major dairy products. This is not a good deal for New Zealand farmers and is impossible to defend to our rural communities. The India FTA would be New Zealand’s first trade deal to exclude our major dairy products - including milk, cheese and butter. In the year to November 2025, New Zealand exports of these products were worth around $24 billion, or 30% of our total goods exports," said Peters.

He also said that New Zealand made serious concessions to India in areas that have nothing to do with two-way trade, but rather relate to encouraging the movement of people from India to New Zealand and New Zealand investment in India. Peters said that New Zealand has offered ‘far greater access for India to our labour market than did Australia or the United Kingdom to secure their FTAs’, which is ‘deeply unwise’. 
 
“New Zealand First looks at all proposed changes on migration from the same standpoint: do they protect the ability of New Zealanders to find meaningful employment as well as the integrity of our immigration system? The India deal fails that test. By creating a new employment visa specifically for Indian citizens, it is likely to generate far greater interest in Indian migration to New Zealand, at a time when we have a very tight labour market,” he said.