India and New Zealand have restarted negotiations on a free trade agreement, marking a revival of discussions that had previously stalled. This development coincides with Prime Minister Christopher Luxon’s five-day visit to Delhi, where he engaged in bilateral talks with Indian Prime Minister Narendra Modi.
Both countries have decided to hold the first round of negotiations next month.
The announcement is a “major breakthrough” in the economic relationship between the two countries, Luxon said.
“India holds significant potential for New Zealand and will play a pivotal role in doubling New Zealand’s exports by value over the next 10 years,” Luxon said.
Currently, trade between India and New Zealand is valued at less than $2 billion (£1.55bn).
Luxon is attending a high-profile geopolitical conference in Delhi as a keynote speaker. Other notable attendees include the US Director of National Intelligence, Tulsi Gabbard.
Beyond trade, New Zealand has expressed a commitment to strengthening ties with India in areas such as defence, security, sports, and environmental collaboration. Strengthening economic relations with Delhi remains a “key priority.”
As part of this engagement, both nations signed a defence cooperation agreement aimed at bolstering maritime security. Additionally, discussions are underway to explore potential partnerships in the digital payments sector.
On 16 March, intelligence and security chiefs from the Five Eyes alliance—including representatives from New Zealand, Australia, Canada, the UK, and the US—participated in a conference in Delhi. The event was hosted by India’s National Security Adviser, Ajit Doval.
New Zealand’s strategic location makes it an important partner for India as the country seeks to counter China’s influence in the Indian Ocean region.
Luxon’s delegation is reportedly one of the largest ever assembled for a prime ministerial visit, highlighting the significance of these discussions.
Trade negotiations between India and New Zealand originally began in 2010 but were halted due to disagreements, particularly concerning market access. New Zealand has long sought greater entry into India’s dairy sector, a market India has historically protected to safeguard local farmers.
In recent years, India has shifted its approach and become more receptive to negotiating trade agreements with various nations. The decision to restart discussions with New Zealand follows similar moves by Delhi to revive free trade negotiations with the European Union and the United Kingdom.
Last year, India finalized a $100 billion free trade agreement with the European Free Trade Association, concluding nearly 16 years of discussions. India and Australia also signed a major trade cooperation deal two years ago.
Meanwhile, India’s trade minister, Piyush Goyal, recently urged an Indian export organization “to come out of their protectionist mindset” as the country advances its trade negotiations.
The renewed focus on trade agreements comes at a critical time, as India prepares for the impact of new tariffs imposed by US President Donald Trump on imported goods, including those from India. These tariffs are set to take effect on 2 April.