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Prime Minister Narendra Modi on Monday hailed the signing of the India-New Zealand Free Trade Agreement, calling it a milestone in bilateral relations and a major step towards deeper economic cooperation. In an article in X, Prime Minister Modi said, “Today marks a milestone in the India-New Zealand partnership! “I am delighted that the India-New Zealand Free Trade Agreement signed today gives unprecedented momentum to our development partnership. It reflects the deep trust, shared values and ambition that unites our two nations. The Prime Minister also emphasized that the agreement will greatly benefit our farmers, youth, women, MSMEs, artisans, startups, students and innovators. "This will open new avenues for growth, create opportunities and deepen our synergy across sectors. New Zealand's $20 billion investment commitment will further strengthen our cooperation in agriculture, manufacturing, innovation and technology, paving the way for a more prosperous and dynamic future for both countries,” he said.

New Zealand Prime Minister Christopher Luxon also described the agreement as an important milestone in relations between the two countries. In his article in X, Luxon said, “Today we mark a milestone in India-New Zealand relations: the signing of our Free Trade Agreement. He added that the agreement is of strategic importance, signaling a common commitment to sustainable and rules-based trade at a time of global uncertainty. Luxon also highlighted the role of the Indian diaspora in strengthening ties, calling it the center of the relationship between the two countries. The two leaders described the agreement as an important step forward, while expressing optimism for deeper cooperation in the coming years.

What does this agreement mean?

Big boost to exports to India: All 8,284 categories of Indian products will benefit from duty-free access to the New Zealand market from the start, eliminating previous customs duties of up to 10%. This makes Indian products more competitive and affordable abroad.
Key industries are expected to benefit: sectors such as textiles, leather, pharmaceuticals, engineering, chemicals, electronics and agricultural exports such as spices, coffee and grains are expected to see more demand and growth.
India selectively opens its market: India will reduce or eliminate tariffs on about 70% of its range of products, covering most imports from New Zealand, especially products such as wool, wine, wood, coal, avocados and blueberries.
Protection of sensitive sectors: Almost 30% of tariff lines remain protected, meaning that critical domestic industries such as milk, pulses, edible oils, sugar, onions and defense products are protected from foreign competition.
Support for farmers and allied sectors: The agreement includes cooperation in agriculture, fisheries, forestry and animal husbandry, with technology sharing aimed at improving productivity and sustainability in India.

Easier opportunities for Indian professionals: A new visa pathway will allow up to 1,667 skilled Indian workers annually (with a cap of 5,000 at a time), creating better global job prospects.

Increase in foreign investment: New Zealand has pledged to facilitate about $20 billion in investment in India over the next 15 years, particularly in infrastructure, renewable energy, agriculture and technology.