'India-NZ FTA likely to come into force within a month,' says Trade Minister McClay

The India-New Zealand Free Trade Agreement (FTA) could become operational within the next month, New Zealand Trade and Investment Minister Todd McClay said, with both countries now working towards the formal exchange of notes required to bring the pact into force.

Speaking to ANI, McClay said the agreement had secured parliamentary approval in New Zealand and would give Indian exporters duty-free entry into the New Zealand market from the day it is implemented.

Also Read: New Zealand parliament passes 'once-in-a-generation' India trade deal, cutting tariffs on most exports


“We’re very close now. It passed in our Parliament with a significant majority, 93 votes to 26,” McClay said.

The two sides are currently completing the exchange of official notes, a step required before the agreement can formally take effect.

“You can expect that within the next month,” he told ANI.

New Zealand lawmakers approved the legislation needed to implement the pact on September 15. The official parliamentary record, however, puts the vote at 93 in favour and 29 against. The legislation received Royal assent on September 17.

For Indian businesses, McClay said the agreement would open up “a significant opportunity”, with New Zealand set to eliminate tariffs on Indian goods from the first day of implementation, subject to the terms of the pact.

“I think you will see a lot more trade in chemicals and pharmaceuticals, but also in machinery,” he said.

Services could also become a larger component of bilateral trade, with McClay specifically identifying information and communications technology as an area with scope for expansion.

New Zealand, meanwhile, expects the agreement to improve its access to the Indian market across food, machinery, services and investment. McClay described the arrangement as a “win-win” for the two economies.

“India and New Zealand have now made a commitment, and the two governments have said, ‘We trust each other. We will honour these commitments,” McClay said.

The two countries signed the FTA in New Delhi on April 27, 2026, following nine months of negotiations. The agreement provides India with duty-free access for 100 per cent of its exports to New Zealand.

The pact also comes as the two countries seek to significantly expand their trade relationship. McClay said Prime Minister Christopher Luxon and Prime Minister Narendra Modi had set a goal of doubling bilateral trade by 2030.

Trade between the two countries is currently around NZ$4 billion, according to McClay, who said the new agreement could help them “surpass” the target.

New Zealand’s Ministry of Foreign Affairs and Trade has set the 2030 two-way trade ambition at NZ$7 billion.

The agreement could also facilitate greater movement between the two countries, including for students, professionals, tourists and business travellers.

McClay said direct flights between India and New Zealand were expected within around a year, which he said could further deepen people-to-people links.

McClay attributed the conclusion of the long-pending trade negotiations to a strengthening relationship and greater trust between the two countries.

“Fundamentally, it comes down to the friendship that has been formed,” he said, referring to the ties between Modi and Luxon and his own relationship with Commerce and Industry Minister Piyush Goyal.

The speed of the negotiations, he said, reflected that growing confidence between the two sides.

“We decided we wanted to do the highest-quality agreement as quickly as we could… To be able to achieve that in nine months shows just how much trust has developed between our two countries,” McClay said.

With global trade facing tariff pressures and greater uncertainty, McClay said the agreement also underscored the importance of stable and predictable trade arrangements.

“It creates absolute certainty for our businesses, and it sends a signal that two countries like India and New Zealand respect the rules and know that trade rules are important,” he said.

According to McClay, the pact could generate jobs and new opportunities in both economies while also offering a model for other countries.

(With inputs from ANI)