Overview of India-New Zealand Free Trade Agreement (FTA)
India has signed a Free Trade Agreement (FTA) with New Zealand, which includes significant tariff eliminations and investment commitments, marking a strategic and economic collaboration between the two nations.
Major Features of the FTA
- Tariff Eliminations:
- Full tariff elimination on all Indian exports to New Zealand.
- Reduction of tariffs on 95% of New Zealand's imports into India.
- Investment Commitment:
- New Zealand promises to invest $20 billion in India over the next 15 years.
- This feature is a new element in India's trade pacts with developed countries.
Strategic Importance
New Zealand Prime Minister Christopher Luxon highlighted the FTA's role in promoting stable, predictable, and rules-based trade amidst global uncertainties.
Goods Market Access
- India’s Tariff Liberalization:
- India offered tariff liberalization on 70.03% of tariff lines covering 95% of bilateral trade value.
- Duty-Free Access:
- 100% duty-free access for Indian exports to New Zealand.
- Key Exports and Imports:
- India's exports: aviation fuel, textiles, pharma, machinery.
- New Zealand's exports: forestry, sheep meat, wool, coal, and more.
Unique Provisions
- Apples and Kiwifruit Access:
- First FTA to secure preferential access for apples and tariff-free access for kiwifruit.
- Linked to New Zealand's cooperation under the Apple Action Plan.
Exclusion Categories
- Products Excluded from Tariff Reductions:
- Dairy, animal products, certain agricultural products, sugar, gems and jewellery, among others.
Mobility and Visa Provisions
- New pathways for Indian students and professionals to work in New Zealand.
- Work and Holiday visa scheme for young Indians.
Investment Caution
Experts like Ajay Srivastava advise caution regarding New Zealand's $20 billion investment promise, noting past investment levels have been low.
