India and New Zealand have agreed to initiate detailed negotiations for a mutually beneficial free trade agreement (FTA), Indian Prime Minister Narendra Modi announced on Monday following discussions with New Zealand Prime Minister Christopher Luxon. The agreement is anticipated to be finalized by the end of 2025, according to an official from India’s foreign ministry.
Efforts to establish a free trade deal between the two nations have faced challenges in the past, particularly regarding New Zealand’s access to India’s heavily protected dairy sector. New Zealand, one of the world’s largest milk producers, has sought greater market entry, but India’s domestic dairy industry remains a sensitive issue.
During their meeting, Prime Minister Luxon expressed optimism about the negotiations, stating that both countries are committed to achieving a “balanced, ambitious, and comprehensive agreement.” He emphasized that the FTA would create expanded opportunities for both nations and their citizens, aiming for a mutually beneficial outcome.
Prime Minister Modi highlighted the potential for collaboration in key sectors, including dairy, food processing, and pharmaceuticals. He described the partnership as a “match-winning” opportunity for both countries, underscoring the importance of mutual cooperation and investment.
In addition to trade discussions, the two leaders signed agreements to enhance cooperation in education, defense, and sports. A joint statement released after the meeting noted their commitment to strengthening trade and investment ties, aiming to unlock untapped potential and promote inclusive and sustainable economic growth.
Trade data from the Observatory of Economic Complexity revealed that India’s exports to New Zealand amounted to $682 million in 2023, while New Zealand’s exports to India totaled $369 million during the same period.
Jaideep Mazumdar, Secretary (East) at India’s Ministry of External Affairs, confirmed that the FTA negotiations have been initiated with a time-bound approach. He expressed hope that the agreement could be concluded by the end of this year, marking a significant milestone in bilateral relations between the two nations.
