India-New Zealand FTA: What Business Opportunities Does the Agreement Offer?

The India-New Zealand Free Trade Agreement (FTA) is set to enter into force on 20 October 2026, following completion of domestic approval processes in both countries. The agreement, signed on 27 April 2026, will provide duty-free access to New Zealand for 100 per cent of India’s exports from day one, benefiting sectors such as textiles, leather, footwear, engineering goods, pharmaceuticals, and processed foods.

For New Zealand companies considering entry into India, the agreement provides opportunities across goods, services, investment, customs facilitation, and SME cooperation.

It also provides for facilitating US$20 billion in investment into India and expands opportunities in services and professional mobility.

India and New Zealand aim to double bilateral trade in goods and services to NZ$7 billion by 2030.

How does the India-New Zealand FTA support New Zealand businesses seeking to enter India?

The FTA provides a framework for expanding trade and investment between India and New Zealand. Its key provisions include tariff concessions on Indian imports, services-sector commitments, investment promotion, simplified customs procedures, and cooperation to improve opportunities for small and medium-sized enterprises (SMEs).

For New Zealand businesses, these provisions may support the export of eligible goods and services to India, investment-related cooperation, and greater access to trade-related information. The actual benefits depend on the relevant product or service commitment and applicable Indian regulations.

What investment commitments has New Zealand made under the FTA?

New Zealand has committed to promote foreign direct investment (FDI) inflows into India, with a view to increasing such investment by US$20 billion.

The Investment Promotion and Cooperation chapter also encourages private-sector engagement, innovation, capacity building, and investment.

The commitment is intended to promote investment; it does not constitute a guarantee of investment flows, approvals, or unrestricted market access for New Zealand companies.

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What tariff concessions has India offered to New Zealand under the FTA?

India has offered tariff concessions on 70.03 per cent of its tariff lines, covering approximately 95 per cent of the current bilateral trade value. The remaining 29.97 per cent of tariff lines are excluded from tariff concessions.

India’s offer includes a combination of immediate and phased tariff liberalisation, tariff reductions, and tariff-rate quotas (TRQs). Accordingly, the applicable benefit depends on the product’s tariff classification and the specific concession schedule.

Which products are excluded from India’s tariff concessions?

India’s exclusion list primarily covers products considered sensitive from a domestic perspective. Major categories include the following:

1. Dairy products, including milk, cream, whey, yoghurt, and cheese
2. Several animal and vegetable products
3. Sugar and artificial honey
4. Animal, vegetable, or microbial fats and oils
5. Precious metals and finished jewellery
6. Copper and aluminium products
7. Arms and ammunition

Certain products, including apples, kiwifruit, Manuka honey, and albumins, are subject to calibrated tariff-rate quotas and other specified safeguards. New Zealand exporters should therefore verify the applicable product-specific terms before assessing the FTA’s commercial benefits.

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Can New Zealand goods routed through India receive preferential tariff treatment under the FTA?

The FTA’s preferential tariff treatment is limited to goods that satisfy its Rules of Origin (RoO). These rules determine whether a product qualifies as originating in India or New Zealand.

The agreement provides for bilateral cumulation, allowing qualifying originating materials or goods from one party to be incorporated into production in the other party, subject to the applicable requirements. It does not permit third-country cumulation.

Consequently, goods originating in a third country cannot qualify for India-New Zealand FTA preferences merely by being routed through New Zealand. Customs authorities may verify origin claims, request supporting information, and conduct verification visits where necessary.

Which services sectors offer opportunities for New Zealand businesses under the India-NZ FTA?

India has made market-access commitments covering 106 services sectors and sub-sectors, such as financial services, telecommunications, environmental services, and professional services.

The agreement also includes commitments relating to foreign commercial presence in specified financial services activities. For example, India has offered FDI limits of up to 74 per cent in the insurance sector and in foreign private-sector banks. Additionally, the agreement lists provisions allowing foreign banks to establish up to 15 branches in India over a four-year period.

These commitments are sector-specific. New Zealand service providers should review the relevant schedules and applicable Indian licensing, ownership, and regulatory requirements before establishing operations.

How does the FTA simplify customs procedures for businesses trading with India?

Under the India-New Zealand FTA, the Customs Procedures and Trade Facilitation (CPTF) chapter aims to improve transparency, predictability, and efficiency in bilateral trade. Its provisions include the following:

• Electronic submission and processing of customs documents
• Pre-arrival processing of shipments
• Risk-based and selective inspections
• Expedited release of goods, including express shipments and perishable goods
• Access to advance rulings
• Review and appeal mechanisms
• Customs cooperation and information exchange

These measures are intended to reduce border delays, transaction costs, and procedural uncertainty for traders. changes to those laws.

Does the FTA provide special support for New Zealand SMEs entering India?

Yes. The FTA contains a dedicated SME chapter that seeks to increase trade and investment opportunities for SMEs through structured cooperation.

The commitments include maintaining a free, publicly accessible website providing information on matters such as business registration procedures, government procurement opportunities, and SME investment and financing programmes. Both countries will also designate SME contact points.

The chapter covers cooperation through SME centres or incubators, information exchange, sharing of best practices, and support for participation in digital trade and e-commerce. These measures are intended to improve access to trade-related information and facilitate SME participation in bilateral trade.

How does the FTA address competition and the treatment of foreign enterprises?

The competition chapter mandates each party’s competition law to address anti-competitive agreements, abuse of dominant position, and mergers or combinations with substantial anti-competitive effects.

It also provides that competition authorities must not discriminate between persons on the basis of nationality. Businesses under investigation are entitled to procedural protections, including the right to be heard, judicial review of decisions, and protection of confidential information, subject to applicable legal exceptions.

Does the FTA override India’s domestic laws or tax treaties?

No. The India-New Zealand FTA preserves the parties’ regulatory autonomy through:

1. General exceptions
2. Security exceptions
3. Exceptions relating to direct taxation measures
4. Balance-of-payments safeguards.

The agreement also expressly states that it does not affect either party’s rights and obligations under existing tax conventions. If a provision of the FTA is inconsistent with a tax convention, the tax convention prevails.

Businesses should therefore continue to assess their Indian tax and regulatory obligations under the applicable domestic laws and tax treaties.

Does the FTA create enforceable rights for private companies?

No. The FTA does not create enforceable rights for private individuals or companies. Disagreements relating to its interpretation, implementation, or application are to be addressed through dialogue between the parties or through the agreement’s state-to-state dispute settlement procedure, where applicable.

The agreement also precludes a party from providing a right of action under its domestic law against the other party for rights and obligations under the FTA.

Accordingly, businesses should not treat the agreement as an independent private legal remedy for securing tariff preferences, investment approvals, or other commercial outcomes.

Business takeaway

The FTA provides New Zealand companies with a framework for exploring Indian trade, services, and investment opportunities. However, the commercial relevance of its provisions depends on the specific product or service, the applicable FTA commitments, RoO, and domestic regulatory requirements.