A free trade agreement (FTA) between India and New Zealand, signed in April, is set to take effect on October 20, 2026, as announced by Indian Trade Minister Piyush Goyal. This initiative aims to enhance India’s export capabilities and attract foreign investment amid evolving global trade dynamics, according to a report from ARN News Centre.
Both nations ratified the agreement on Monday, with New Zealand’s Trade and Investment Minister Todd McClay exchanging documents with India’s High Commissioner to New Zealand, Muanpuii Saiawi, at the New Zealand Parliament. This agreement comes at a time when the U.S. has enacted legislation allowing tariffs of up to 100% on countries like India for purchasing Russian oil, prompting India to diversify its export markets.
New Zealand’s parliament recently passed the necessary legislation to implement the FTA. McClay stated that the agreement will create a more equitable trading environment and provide New Zealand businesses with access to one of the world’s fastest-growing markets.
Under the terms of the FTA, tariffs on approximately 95% of New Zealand’s exports to India will be eliminated or reduced. Initially, 57% of New Zealand’s exports, including sheep meat, wool, and coal, will be tariff-free from day one. Over time, duty-free coverage is expected to increase to 82%, with the remaining 13% facing significant tariff reductions.
The agreement also grants Indian goods duty-free access to New Zealand and simplifies mobility regulations for students and workers. Additionally, New Zealand has committed to investing $20 billion in India over the next 15 years.
New Zealand exporters will benefit from preferential quota access for products such as apples, kiwifruit, and albumins. Wine tariffs are set to decrease from 150% to either 25% or 50% over a decade, depending on the product’s value.
Prime Ministers Christopher Luxon and Narendra Modi have pledged to double bilateral trade by 2030, aiming to increase trade from approximately $2.3 billion recorded in the 12 months leading up to June. McClay emphasized that the agreement demonstrates the ability of both countries to reach mutually beneficial trade terms, especially in light of rising tariffs and global business uncertainties.
India has expressed concerns that new U.S. tariffs on Russian oil could affect its bilateral relations with the United States, highlighting the significance of diversifying its trade partnerships.
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