New Zealand’s Parliament Approves Trade Deal with India, Aims to Slash Tariffs on Exports

In a significant move towards bolstering economic ties, New Zealand’s Parliament has approved a new legislation aimed at implementing its free trade agreement (FTA) with India. This development, reported on Wednesday, is expected to eliminate or drastically reduce tariffs on about 95% of New Zealand’s exports to the Indian market. The bill passed with a notable majority of 93 votes in favor, against 29 opposing votes, showcasing bipartisan support, particularly from the Opposition Labour Party.

The free trade agreement, which was inked on April 27, marks a pivotal moment in the bilateral relations between India and New Zealand. It will come into force once both nations finalize their domestic ratification processes, although the timeline for this is yet to be clarified. New Zealand’s Trade Minister Todd McClay expressed optimism regarding the deal, stating that it would yield “immediate and substantial” benefits for exporters in New Zealand.

One of the most anticipated outcomes of this agreement is the impact on the kiwifruit industry, which is projected to save around $125 million in tariffs over the next five years. Under the terms of the FTA, Indian goods will enjoy duty-free access to New Zealand, potentially enhancing the flow of trade between the two countries. This agreement is expected to create a more favorable trading environment and strengthen economic cooperation.

Additionally, Wellington has pledged to invest approximately $20 billion in India over the next 15 years, reflecting a long-term commitment to enhancing economic engagement. Currently, the bilateral trade between New Zealand and India stands at NZ$3.99 billion, equivalent to roughly Rs 22,038.41 crore, making India the ninth-largest destination for New Zealand’s goods and services exports.

This newly approved legislation represents not just a tariff reduction but a broader strategy to foster closer relations between the two nations. As New Zealand looks to diversify its trade partnerships, the emphasis on India’s vast market and diverse economy is evident. However, the successful implementation of this trade deal will depend on navigating India’s regional complexities and economic diversity, presenting a challenging yet promising scenario for both countries’ future trade endeavors.

Source: scroll.in