What's In, What's Out: Key Highlights And Protected Sectors In India-New Zealand FTA

The Free Trade Agreement (FTA) between India and New Zealand came into effect at 12:01 AM on the auspicious day of Dussehra, on October 20. The deal allows duty-free entry to 100 per cent of Indian goods in the Island nation’s market, while opening a 1.4-billion Indian market for New Zealand goods. Additionally, it will expand opportunities for services, professionals, students and agricultural cooperation and facilitate foreign direct investments of USD 20 billion over the next 15 years from New Zealand to India.

Commerce and Industry Minister Piyush Goyal said the trade agreement has an aim to increase bilateral trade in goods and services from about USD 2.4 billion to around New Zealand dollar 7 billion or about Rs 35,000 crore, by 2030.

How FTA With New Zealand Is a Gain For India

100% Duty-Free Entry: Indian goods, including leather, footwear, apparel, textiles, and other will reach the New Zealand market without any tariff— 100 per cent duty-freefrom October 20 Onwards. 

First FTA With 100% Duty-Free Market Access: India has many FTAs; however, the trade pact with New Zealand is the first with full duty-free access across all tariff lines. It eliminates pre-FTA rates of up to 10 per cent faced by Indian exporters in the New Zealand market.

Benefits To Broader Sector: Exporters from sectors including fruits and vegetables; coffee, tea, cereals, processed foods, textiles and clothing, leather and footwear, pharmaceuticals, engineering goods, marine products and plastics and rubber will get benefit. 

Big Gain For India’s Service Sector: New Zealand has agreed to open up 118 service sectors or sub-sectors to Indian service providers, offering them better access to its market under the FTA. These include IT, professional services, telecommunications, construction, education, financial services, and tourism.

FTA Benefits For New Zealand 

• New Zealand will get tariff concessions on 70 per cent of its tariff lines, covering about 95 per cent of the current bilateral trade value. The remaining 29.97 per cent of the lines have been kept in the exclusion list.
• India is giving duty-based quotas for apples, kiwifruit, manuka honey and albumins, along with minimum import price (MIP) provisions and other safeguard measures.
• The pact will come with benefits for customs clearance within 48 hours for cargo and 24 hours for express and perishable consignments. 
• Indian companies can provide services in New Zealand. Under the FTA, Indian professionals and business people to work or visit the country for specific periods.

India Protect Sensitive Sectors

Dairy products like milk, cream, whey, yoghurt, and cheese will not enter the Indian market under the FTA. Animal products other than sheep meat and vegetable products such as onions, chana, peas, corn, almonds will also be excluded from the agreement. 

Additionally, the list also includes arms and ammunition, gems and jewellery, copper and copper articles and aluminium and aluminium articles.

(With Inputs From PTI)