India and New Zealand May Sign FTA on April 24, Likely to Bring $20 Billion Investment

India and New Zealand are expected to sign a Free Trade Agreement (FTA) on April 24 in New Delhi, as per PTI reports.  

The signing is likely to take place at Bharat Mandapam. This follows the conclusion of negotiations announced on December 22 last year, after several rounds of discussions between the 2 sides. 

Trade Levels Remain Limited 

Bilateral trade between the 2 countries is currently low compared to other partners. Merchandise trade stood at $1.3 billion in 2024-25. Total trade, including services, was around $2.4 billion in 2024. 

Services accounted for $1.24 billion of this, led mainly by travel, IT, and business services. The FTA sets a target to increase total trade to $5 billion over the next 5 years. 

Investment Estimate Over 15 Years 

The agreement is expected to support investment flows into India over the longer term. Reports have indicated a potential inflow of up to $20 billion over 15 years. This estimate is linked to lower trade barriers and clearer market access conditions. 

Tariff Reductions Across Sectors 

Under the proposed terms, Indian exports are expected to get zero-duty access to the New Zealand market. In return, India will reduce or remove tariffs on about 95% of New Zealand’s exports. 

Items likely to see tariff cuts include wool, coal, wood, wine, avocados, and blueberries. Duty-free access is also expected for sheep meat and a range of forestry products. 

Sensitive Items Kept Out 

India has excluded several products from tariff concessions. These include dairy items such as milk, cream, whey, yoghurt, and cheese. Other excluded categories include onions, sugar, spices, edible oils, and rubber. 

These exclusions indicate a cautious approach towards sectors where domestic production is considered sensitive. 

Provision for Temporary Work Visas 

The agreement includes a provision for movement of professionals. New Zealand will introduce a visa pathway allowing up to 5,000 Indian workers each year to stay for up to 3 years. 

The scheme will cover sectors such as IT, healthcare, engineering, education, and construction, along with roles like chefs, yoga instructors, and music teachers. 

Read More: Trump: Tariff Killed Harley-Davidson In India; Why It Really Exited India? 

Conclusion 

The proposed agreement combines tariff changes, sector-specific exclusions, and provisions for skilled mobility, alongside targets for higher trade and investment over time. 

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