India’s new trade pact with New Zealand combines tariff-free access, visa pathways and investment commitments, reshaping bilateral ties across trade, education and skilled workforce mobility.
Commerce Minister Piyush Goyal and New Zealand officials during the India–New Zealand Business Meet in New Delhi following the signing of the Free Trade Agreement. (Photo: X/@PiyushGoyal)
India and New Zealand on Monday signed a Free Trade Agreement that promises full tariff elimination on Indian exports and wide-ranging access for professionals and students, marking a significant reset in bilateral economic ties.
The agreement, concluded in just nine months since talks began in March last year, comes with a mix of trade liberalisation, investment commitments and mobility provisions – a combination officials say could deepen engagement beyond goods trade.
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Signed in the presence of Commerce Minister Piyush Goyal and New Zealand Trade Minister Todd McClay, the deal gives Indian exporters immediate duty-free access across all tariff lines in the New Zealand market. Currently, a 10 per cent tariff applies to several categories, including textiles, leather goods, carpets and auto components.
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Under the pact, New Zealand will either eliminate or significantly reduce tariffs on 95 per cent of imports from India, while India has retained protections for sensitive sectors such as dairy and certain agricultural products.
The agreement is also backed by an investment commitment, with New Zealand expected to channel $20 billion into India over the next 15 years, echoing similar pledges seen in recent trade agreements with European partners.
A notable feature of the deal is its focus on mobility. For the first time, New Zealand has signed a dedicated annex on student mobility with another country. Indian students will now be allowed to work up to 20 hours a week during their studies, along with access to longer post-study work visas.
The agreement also sets aside 5,000 visas annually for skilled Indian professionals across sectors such as IT, healthcare, engineering, education and construction, along with specialised roles like yoga instructors, chefs and AYUSH practitioners.
Additionally, 1,000 young Indians will be eligible each year under a Working Holiday Visa programme, allowing multiple entries and a stay of up to 12 months.
Officials highlighted strong gains for India’s leather industry, with tariffs on leather and footwear dropping from 5 per cent to zero. The sector, which is targeting a $50 billion size by 2030, is expected to benefit from better access to raw materials from New Zealand and expanded export opportunities.
“New Zealand’s rich raw leather resources, combined with India’s manufacturing capabilities, offer a strong complementarity,” the Commerce Ministry said, adding that both sides see potential in positioning Agra as a global sourcing hub.
Agra, which produces nearly 75 per cent of India’s leather footwear and holds a GI tag, is expected to be a key beneficiary.
The pharmaceutical and medical devices sectors are also set for easier entry into the New Zealand market, with provisions for faster regulatory approvals through acceptance of international inspection reports. The agreement also includes a dedicated chapter on health and traditional medicine, formally recognising AYUSH systems.
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