New Zealand parliament passes free trade deal with India

New Zealand's parliament has given final approval to the India-New Zealand Free Trade Agreement (FTA). The bill was passed 93 votes in favour to 29 against. Trade and Investment Minister Todd McClay gave the official confirmation. The large majority in parliament shows how keen New Zealand is to strengthen economic ties between the two countries.

New Zealand PM Christopher Luxon welcomed the historic agreement. Sharing his thoughts on Instagram, he wrote, "Many people told me it was impossible to strike a free trade agreement with a country as vast as India. But today our government has done it. Parliament's approval of this agreement is a major win for our economic policy." Luxon added that the deal would create millions of new job opportunities for New Zealanders and improve wage levels in the country. He said India's population of 1.4 billion and its fast-growing middle class would now open up for New Zealand producers.

According to Trade Minister Todd McClay, once the FTA comes into force, 57 percent of goods exported from New Zealand to India will become fully duty-free from day one. Once the agreement is fully phased in, customs duties and tariffs on around 95 percent of products will either be removed entirely or brought down to very low levels.

New Zealand's kiwifruit producers stand to benefit the most. The kiwifruit industry alone is estimated to save around NZ$125 million in tariffs over the next five years. Lower taxes on forestry products, apples, wool products and other agricultural goods will also let New Zealand exporters sell more competitively in the Indian market.

The agreement does not just cut taxes, it also sets up a system to speed up customs clearance. India's fast-growing middle class is currently driving strong demand for good quality food and beverages, technology, education, tourism and professional services. New Zealand companies will now find it much easier to reach Indian customers directly in all these sectors. The New Zealand government has set a target of doubling bilateral trade with India by 2030, and this FTA is seen as the most important step towards that goal.

India and New Zealand announced talks on the agreement in March 2025, and the two countries completed negotiations quickly. New Zealand's parliament has passed its bill, but both countries will now complete their domestic ratification procedures. Both governments expect the agreement to come fully into force by the end of this year. The deal is expected to benefit India as well, with Indian products such as pharmaceuticals, textiles, IT services and skilled manpower getting easier entry and duty exemptions into New Zealand. Overall, the agreement is set to reshape economic equations in the Asia-Pacific region.