India and New Zealand are set to sign their long-pending Free Trade Agreement (FTA) on Monday at Bharat Mandapam, in the presence of Union commerce and industry minister Piyush Goyal and New Zealand’s minister for trade and investment Todd McClay. The agreement, finalised in December 2025 after negotiations that began in March the same year, is aimed at boosting trade ties and expanding economic engagement between the two countries. The agreement is expected to come into force in the coming months, with Goyal noting that it would serve as a catalyst for expanding trade ties. “In a few months, it will be a means of increasing trade between India and New Zealand,” Goyal said.Speaking on the relationship, McClay said that ties between the two countries are at their strongest. “It’s very strong. In fact, it’s probably the strongest relationship that I have ever known. We, as a government of New Zealand, have said that we want to make our relationship with India and its government a strategic priority…I think we will see direct flights between India and New Zealand. Many more people can come and visit for tourism… we’re about to sign a free trade agreement.”
Here’s what the pact means for India
Duty-free access and trade expansionThe agreement is expected to provide duty-free access for Indian exports to New Zealand, opening up significant opportunities for domestic industries. “Goods exported from India to New Zealand will go without any tax, creating significant opportunities, including for Agra’s leather industry and other sectors,” Piyush Goyal said. Approximately 70% of goods from India to New Zealand are expected to face no import duty.Boost for MSMEs and traditional sectorsThe deal is likely to benefit several labour-intensive and MSME-driven sectors, particularly in export-oriented clusters such as Agra, known for its leather and footwear industry. “We will get new opportunities for our Agra leather business and Uttar Pradesh handloom and handicrafts… to our one district one product… to our carpenters who make the goods to the handcarvers and many more opportunities,” Goyal said.Agra, one of India’s largest leather and footwear hubs, is expected to gain from improved market access once the agreement comes into force.Services, visas and workforce mobilityThe agreement includes provisions to facilitate services trade, including a temporary employment visa pathway for Indian professionals. This will allow up to 5,000 visas annually, with a stay of up to three years, covering sectors such as IT, engineering, healthcare, education and construction.It also includes professionals such as AYUSH practitioners, yoga instructors, Indian chefs and music teachers, aimed at strengthening workforce mobility between the two countries.Regulatory easing and sectoral cooperationThe FTA is expected to streamline regulatory processes and reduce non-tariff barriers through enhanced cooperation. It includes faster access for Indian pharmaceuticals and medical devices by recognising international inspection standards, reducing duplication and lowering compliance costs.In agriculture, New Zealand will work with India on an Agri-Technology Action Plan focused on kiwifruit, apples and honey, aimed at improving productivity, quality and supply chains.Investment and tradeThe pact aims to double bilateral trade to $5 billion within five years, from the current level of around $2.4 billion. New Zealand has committed to investing $20 billion in India over the next 15 years across sectors such as manufacturing, infrastructure, services and innovation, with a focus on job creation. The agreement is also expected to strengthen economic resilience and support inclusive growth aligned with India’s national priorities.
What New Zealand gains
Under the pact, New Zealand will receive tariff reductions or elimination on 95% of its exports to India, including products such as wool, coal, wood, wine, avocados and blueberries. Duty concessions will also be extended to items like kiwifruit, seafood, cherries and Manuka honey, with some exports subject to quotas.At the same time, India has excluded several sensitive sectors, including dairy products, onions, sugar, spices, edible oils and rubber, from tariff concessions to protect domestic farmers and industries.
Goyal and McClay visit Taj Mahal
Ahead of the signing, Goyal and McClay visited the Taj Mahal, accompanied by their spouses, spending nearly two hours at the site.During his visit, Goyal held discussions with local industry representatives from sectors including leather, textiles, spices, handloom, handicrafts and carpets.“I was fortunate that today I got the opportunity to have a very detailed and meaningful discussion with Agra’s industry. The excellent work being done in Agra, across various industries, be it the leather industry, textiles, or spices industry, and the way I learned about numerous sectors like handloom, handicrafts, and carpets, makes it clear that Agra will play a crucial role in the future, especially in exports. We also discussed various issues that hinder Agra’s industry’s rapid growth,” he said.He added that plans are being explored to establish a new industrial park near Agra as part of a broader push to create 100 such parks across the country.
