India-New Zealand FTA: Duty-free access, 5,000 visas, USD 20-bn investment

India and New Zealand on Monday (April 27) signed a free trade agreement (FTA), marking a significant step in strengthening bilateral trade and investment ties. The deal positions New Zealand as one of India’s key partners in the Oceania region and is expected to open new avenues across goods, services, and mobility.

Also read: India, New Zealand set to seal landmark FTA to boost trade, investment: Explainer

Calling it a "once-in-a-generation" deal, New Zealand Prime Minister Christopher Luxon said the pact opens new pathways for trade in goods and services, investment flows, and labour mobility between the two countries.

Duty-free access

A key feature of the agreement is New Zealand’s commitment to provide duty-free access to 100 per cent of Indian exports. This is expected to benefit labour-intensive sectors such as textiles, apparel, leather, footwear, gems and jewellery, engineering goods, and processed foods.

In return, India has offered market access on 70.03 per cent of its tariff lines, allowing New Zealand exports to enter Indian markets with reduced barriers.

Protected sectors

To safeguard domestic industries, India has excluded several sensitive sectors from tariff concessions.

Also read: PM Modi announces signing of India-EU free trade agreement

These include dairy products such as milk, cheese, and yoghurt, as well as key agricultural items like onions, pulses, corn, and almonds. Other excluded categories include sugar, edible oils, certain metals, and arms and ammunition, reflecting a calibrated approach to trade liberalisation.

Investment commitments

New Zealand has committed to facilitating investments worth USD 20 billion in India over the next 15 years.

These investments are expected to focus on infrastructure, technology, and renewable energy, strengthening long-term economic collaboration between the two countries.

Visa provisions

The agreement allows up to 5,000 skilled Indian professionals annually to work in New Zealand for up to three years. These include sectors such as IT, engineering, healthcare, construction, and education, along with specialised roles like yoga instructors, chefs, and traditional practitioners.

Also read: How India’s EU and US trade pacts compare with the 1991 liberalisation

Additionally, 1,000 young Indians will be eligible for multiple-entry visas for a period of 12 months.

Education opportunities

For the first time, New Zealand has signed an annexe on student mobility and post-study work visas with any country.

Indian students will be allowed to work up to 20 hours per week during their studies, with extended post-study work rights up to three years for bachelor’s and master’s graduates, and up to four years for doctoral candidates.

Boost to traditional medicine

A unique aspect of the agreement is the inclusion of an annex promoting trade in traditional medicine.

Also read: NZ foreign minister Peters slams India FTA as ‘neither free nor fair’

This provision supports global recognition of India’s AYUSH systems, including Ayurveda, Yoga, Unani, Siddha, and Homeopathy, while also encouraging collaboration with Maori health practices. It is expected to boost medical value travel and wellness services.

Trade opportunities

While India stands to gain from improved access in sectors such as pharmaceuticals, textiles, and leather, New Zealand will benefit from easier entry for products like wool, wine, wood, coal, and fruits such as avocados and blueberries.

The agreement also simplifies regulatory processes and sanitary measures to facilitate smoother trade flows.

Agri-tech collaboration

An Agri-Technology Action Plan under the agreement will promote collaboration in agricultural productivity. New Zealand is expected to support Indian farmers with expertise in areas such as apple, kiwi, and honey production, enhancing efficiency and output in the sector.

Also read: India, New Zealand to resume FTA talks after a decade

The agreement aims to double the bilateral trade to about USD 5 billion over the next five years and set the stage for deeper economic integration between the two countries.