India and New Zealand Seal Landmark Free Trade Agreement, Aim to Double Bilateral Trade in Five Years

In a development that could quietly reshape the economic relationship between South Asia and the Pacific, India and New Zealand have taken a decisive step forward. On Monday, Narendra Modi and Christopher Luxon announced the successful conclusion of a landmark India–New Zealand Free Trade Agreement (FTA), marking a new chapter in bilateral ties between the two nations.

What makes this agreement particularly striking is not just its scope, but the speed at which it was achieved. Negotiations for the FTA were formally launched during Prime Minister Luxon’s visit to India in March 2025. Just nine months later—an unusually swift timeline in global trade diplomacy—the two sides have sealed what both leaders describe as an ambitious, mutually beneficial and future-focused pact. Officials on both sides see this as a clear signal of strong political will and a maturing strategic partnership.

India-New Zealand: A trade pact with wider ambitions

According to official sources, the India–New Zealand FTA is designed to go well beyond tariff reductions. It aims to significantly deepen economic engagement by improving market access, encouraging two-way investment flows and strengthening cooperation across a broad range of sectors. For businesses and entrepreneurs, this means smoother trade processes and greater certainty. For investors, it opens doors to long-term opportunities in fast-growing markets.

Crucially, the agreement is expected to create tangible benefits for people on the ground. Innovators, startups, farmers, MSMEs, students and young professionals in both countries stand to gain as barriers reduce and collaboration increases. In India, where the startup ecosystem continues to expand rapidly, the FTA is expected to provide new global linkages and capital access. In New Zealand, businesses gain stronger entry into one of the world’s fastest-growing large economies.

Doubling trade and a long-term investment push

Building on the foundation laid by the FTA, Prime Minister Modi and Prime Minister Luxon expressed confidence that bilateral trade between the two countries can be doubled over the next five years. This ambition is backed by a significant investment commitment from New Zealand, which has indicated plans to invest up to USD 20 billion in India over the next 15 years.

These investments are expected to span diverse sectors, contributing to job creation, technology transfer and deeper industrial collaboration. Indian officials highlighted that the country’s reform-driven economy, young talent pool and vibrant startup ecosystem provide a strong base for sustained partnerships and innovation-led growth.

Beyond economics: a broader partnership

While trade and investment were central to the conversation, the leaders also reviewed progress in other strategic areas. Defence cooperation, sports exchanges, education partnerships and people-to-people ties featured prominently in their discussions. Both sides reaffirmed their commitment to strengthening these links, underlining that the relationship is not limited to commerce alone.

In a post shared on social media platform X, Prime Minister Modi described the agreement as an important moment for India–New Zealand relations. He said the FTA sets the stage for scaling the partnership to “newer heights,” with a strong push to bilateral trade and investment. He also welcomed New Zealand’s proposed investments and pointed to India’s youthful population and innovation ecosystem as key strengths.

Prime Minister Luxon echoed similar sentiments, calling the agreement historic and highlighting the shared ambition that enabled its rapid conclusion. He noted that the FTA ensures enhanced market access, deeper investment flows and wide-ranging opportunities for entrepreneurs, farmers, MSMEs, students and youth in both countries.

As global trade faces uncertainty and fragmentation, the India–New Zealand FTA stands out as a signal of confidence in open markets and strategic cooperation. With clear targets, long-term investment commitments and a people-centric focus, the agreement is poised to shape economic and diplomatic ties for years to come.

Both leaders agreed to remain in close touch and continue working together to advance shared priorities—suggesting that this agreement may be just the beginning of a deeper, more dynamic partnership between India and New Zealand.