By Saksham Singh
New Zealand’s Parliament has approved legislation to put its free-trade agreement with India into effect, opening the door to lower tariffs and easier access for goods and services traded between the two countries.
The agreement is expected to reduce or remove tariffs on around 95% of New Zealand’s exports to India. It is being seen as an important step in strengthening economic ties between the two countries and giving businesses on both sides greater access to each other’s markets.
The legislation was passed by New Zealand’s Parliament on September 15 and received Royal Assent on September 17, meaning it has now become law. The agreement will come into force after the required implementation process is completed.
For New Zealand exporters, the deal could make it easier to sell products such as dairy-related goods, meat, wool, forestry products, seafood, fruits and other agricultural products in the Indian market. New Zealand currently exports goods and services worth billions of dollars to India each year.
Under the agreement, 57% of New Zealand’s exports will become eligible for tariff elimination when the deal begins. That figure is expected to increase to 82% as the agreement is gradually implemented. Another 13% of exports will receive significant tariff reductions.
Some products will benefit from immediate changes. Tariffs on sheep meat, wool and coal will be removed immediately, while most seafood exports are expected to receive duty-free access over a period of seven years.
New Zealand’s forestry sector is also expected to benefit. More than 95% of its forestry and wood exports to India will be eligible for tariff-free access once the agreement comes into effect. Tariffs on almost all existing forestry trade are expected to disappear within seven years.
The agreement also gives New Zealand greater access for products such as apples and kiwifruit through specific import quotas. These changes could make New Zealand products more competitive in India by reducing the additional cost created by import tariffs.
The deal is not only about goods. It also covers services, investment and the movement of professionals and students between the two countries.
New Zealand has agreed to provide access across 118 services sectors, giving Indian companies and professionals more opportunities in areas such as business services and other professional fields. India, meanwhile, has opened opportunities for New Zealand service providers in several sectors.
Indian exporters are also expected to benefit from the agreement. New Zealand will provide duty-free access for Indian exports, giving products from sectors such as textiles, leather, pharmaceuticals, engineering and automobiles greater access to its market.
However, India has kept some protections for sensitive sectors. During the negotiations, areas such as dairy and certain agricultural products were treated differently from other goods because of concerns surrounding domestic producers. Some of these areas will continue to have restrictions or phased access rather than immediate tariff elimination.
The agreement was signed in New Delhi on April 27 by India’s Commerce and Industry Minister Piyush Goyal and New Zealand’s Trade and Investment Minister Todd McClay.
The negotiations had begun in March 2025 and were concluded in December that year. The two countries then moved towards signing and implementing the agreement.
The trade deal comes at a time when both India and New Zealand are looking to expand their economic relationship. For New Zealand, India represents a large and growing consumer market where its exporters can look for new opportunities. For India, the agreement could help its businesses gain easier access to the New Zealand market.
The agreement also includes investment commitments. India has highlighted a proposed long-term investment commitment of $20 billion from New Zealand as part of the broader economic relationship.
New Zealand’s parliamentary approval was an important step towards implementing the agreement. The country has now changed its domestic laws covering areas such as tariffs, customs, overseas investment and import quotas to meet its commitments under the deal.
The next step is for the agreement to officially come into force. Once that happens, tariff reductions and other commitments will be introduced according to the schedules agreed upon by the two countries.
For India and New Zealand, the agreement represents a shift towards a closer economic partnership. As the tariff reductions are introduced over the coming years, businesses and consumers in both countries will get a clearer picture of how much the new trade rules change the way goods and services move between the two markets.