New Zealand Prime Minister Christopher Luxon expressed optimism on Tuesday about signing a free trade agreement (FTA) with India within 60 days, a step he believes could amplify bilateral trade tenfold over the next decade.
Speaking at the India-New Zealand Economic Summit hosted by FICCI, Luxon said, “Let’s drive this relationship forward, and I look forward to Prime Minister Modi signing that agreement in 60 days’ time.” The announcement follows the resumption of FTA talks on Sunday, reviving negotiations dormant since 2015 after a decade-long hiatus.
India’s Commerce Minister Piyush Goyal echoed the ambition, projecting a “10x growth in the next 10 years” if both nations leverage their complementary economies. “There is hardly anything on which we compete with each other, and those few areas of sensitivity we can very easily navigate or respect,” Goyal noted, citing India’s FTA with the UAE, sealed in 90 days, as precedent. However, he tempered expectations, adding, “No free trade agreement is ever negotiated with a gun on anybody’s head. There’s never a sacrosanct timeline, but it’s good to be aspirational.”
The proposed Comprehensive Economic Cooperation Agreement (CECA), initiated in 2010, stalled over contentious issues like New Zealand’s dairy, apples, and wine exports—sectors India protects with tariffs averaging 17.8%, starkly higher than New Zealand’s 2.3%. New Zealand Trade Minister Todd McClay acknowledged potential hurdles, particularly dairy, but emphasized mutual respect in negotiations: “One of the most important things we’re going to do is respect our negotiators.” Goyal, addressing broader trade talks including with the U.S., stressed outcomes must serve India’s interests.
Bilateral trade, at $873.4 million in 2023-24 (down from $1.02 billion the prior year), remains modest—India exports textiles, pharmaceuticals, and machinery, while importing New Zealand’s apples, wool, and timber. The Global Trade Research Initiative (GTRI) cautions that India’s gains may be limited, with 58.3% of New Zealand’s tariff lines already duty-free, offering Indian firms significant access sans an FTA. Luxon’s visit, his first since taking office, builds on this base, leveraging a 250,000-strong Indian diaspora to deepen ties.