“India and New Zealand have signed a free trade agreement, making all Indian exports to New Zealand duty-free and cutting or eliminating tariffs on 95 percent of New Zealand’s exports to India,” reports The Doomslayer.
India and New Zealand on Monday signed a free trade agreement to deepen economic ties and expand market access, as both countries navigate mounting global trade disruptions.
The deal comes as New Delhi moves to diversify export markets to offset the impact of steep tariffs imposed by the United States and instability in shipping and energy routes due to the Iran war. For New Zealand, the agreement is part of a broader push to reduce reliance on China, its largest trading partner.
The agreement was signed in New Delhi by India’s Commerce and Industry Minister Piyush Goyal and visiting New Zealand Trade and Investment Minister Todd McClay.
Negotiated over nine months and agreed in December, the deal will cut or eliminate tariffs on 95% of New Zealand’s exports to India, while making all Indian exports to New Zealand duty-free. Wellington has also committed to invest $20 billion in India over the next 15 years.
In the past, India had lots of tariffs and trade barriers, which slowed India’s economic growth, and contributed to India falling behind other countries in east Asia that once were poorer than it.
India historically had many restrictions on imports, resulting in Indians buying inferior locally manufactured goods at higher prices than if freer trade existed. Even today, India has far higher average tariffs than developed countries. Indian tariffs average around 12 percent, compared to 1% in Australia and the United Kingdom. The Heritage Foundation notes that in India, “The trade-weighted average tariff rate is 12.0 percent, and layers of nontariff measures are in force.”
