India-New Zealand free trade agreement comes into force, duty-free entry for Indian goods

The free trade agreement between India and New Zealand came into force on Tuesday, October 20. India is trying to strengthen its place across the world, and the effort is visible in its various agreements. The pact has been described as highly beneficial not only for New Zealand but also for India, and it is said to boost several industries.

Under the agreement, many Indian goods, including products from sectors such as textiles, leather goods and footwear, will get tax-free entry into the New Zealand market. As per the agreement, all tariff categories of Indian exports have been given tax-free entry from the first day. New Zealand's Prime Minister has called the agreement historic.

This is India's seventh trade agreement to come into force in the past five years. India has earlier put in place trade agreements with the United Arab Emirates (UAE), Mauritius, the European Free Trade Association, the United Kingdom, Oman and Australia. With the New Zealand pact taking effect, the number of the country's operational free trade agreements has reached 17.

The two countries signed the agreement on April 27, 2026. Negotiations began in 2010 but stalled in 2015. The two countries resumed talks in March 2025, after which the agreement was finalised.

Experts expect the agreement to benefit textiles and garments, leather goods and footwear, engineering products, auto spare parts, gems and jewellery, agricultural and food products, the pharmaceutical industry and other manufacturing sectors. Indian exporters could gain a competitive edge in the New Zealand market. New opportunities could open up especially for micro, small and medium enterprises.

Gulzar Didwania, partner at Deloitte India, said the agreement is expected to increase foreign direct investment in India. He said New Zealand has committed to $20 billion of foreign direct investment in India over the next 15 years. According to Didwania, duty-free entry on certain raw materials, simpler customs procedures and investment-promotion provisions could strengthen the integration of the two countries' value chains. This would also help create an investment-friendly environment.

Didwania also said the agreement is not limited to trade and is important strategically as well. According to him, it will strengthen India's position in the Indo-Pacific region and widen the network of free trade agreements with developed economies.