After a gap of about ten years, India and New Zealand on Sunday announced resumption of negotiations for a proposed free trade agreement to boost economic ties.
India and New Zealand began negotiating the Comprehensive Economic Cooperation Agreement (CECA) in April 2010 to boost trade in goods, services, and investment. However, after nine rounds of discussions, the talks stalled in 2015.
"The two nations are pleased to announce the launch of negotiations for a comprehensive and mutually beneficial India-New Zealand Free Trade Agreement (FTA) negotiations," the commerce ministry said.
The announcement was made after the meeting of Commerce and Industry Minister Piyush Goyal and Todd McClay, New Zealand's Minister for Trade and Investment.
Prime Minister of New Zealand Christopher Luxon is here on a four-day visit from March 16.
"The India-New Zealand FTA negotiations aim to achieve balanced outcomes that enhance supply chain integration and improve market access," it said.
"With bilateral trade continuing to grow steadily, surpassing USD 1 billion during April-January 2025, the FTA negotiations aim to unlock new avenues for businesses and consumers, fostering mutual growth and prosperity of our nations," Goyal said in a post on X.
According to think tank Global Trade Research Initiative (GTRI), India's proposed FTA with New Zealand would have limited benefit to domestic companies as they are already enjoying duty-free access to a significant number of goods in that market.
New Zealand's average import tariff is just 2.3 per cent, compared to India's 17.8 per cent, it has said.
The bilateral trade between the two countries stood at USD 873.4 million (exports USD 538.33 million and imports USD 335 million) in 2023-24 as against USD 1.02 billion in 2022-23.
The GTRI report has said that 58.3 per cent of New Zealand's tariff lines (or product categories) are duty-free, meaning Indian products already enjoy significant access without a trade pact in the New Zealand market.
The Indian diaspora in New Zealand, with over 250,000 people of Indian origin, provides a strong cultural link that can be used to strengthen trade relations.
India's key goods exports to New Zealand include clothing, fabrics, and home textiles; medicines and medical supplies; refined petrol; agricultural equipment and machinery such as tractors and irrigation tools; auto; iron and steel; paper products; electronics; shrimps; diamonds; and basmati rice.
The main imports are agricultural goods, minerals, apples, kiwifruit, meat products such as lamb, mutton, milk albumin, lactose syrup, coking coal, logs and sawn timber, wool, and scrap metals.
According to trade experts, the tricky point in the talks would duty concessions in agri products like apple, kiwi, dairy, and wine.
India has not yet given any significant concession in dairy to any of its other FTA partners, including Singapore, Japan, South Korea, and the Asean.
