Mark your calendars for Tuesday the 20th of October 2026! The long-awaited free trade agreement between New Zealand and India officially comes into effect on that date.
In today’s Chart of the Week, we cast a spotlight on New Zealand’s existing trade with India. One of our exports to India completely outshines the rest. And it might not be what you’d expect…
Kiwi enjoy a solid trading relationship with India. There is a steady flow of goods and services crossing our respective borders. New Zealand has usually enjoyed a healthy trade surplus with India in most quarters of the available data. But as far as key trading partners, it would be a stretch to include India under that label. For now.
India does not consume a lot of meat. So, New Zealand doesn’t export any meat there. India also has a highly protective dairy industry, with the government protecting its domestic farmers from international competition. So again, another critical export for New Zealand which has bolstered our trade with other nations has not achieved anything in India.
So, what on earth does New Zealand export to India? And what do we import from them?
Well, various wood-derived products leave our shores for India in a small but decent quantity. Fruit and nuts, aluminium and wool, too. Conversely, we buy products such as medicine, machinery and textiles from India. But the numbers on these products really are piecemeal.
The key flow between our two borders is not products. It’s people.
The biggest export from New Zealand to India, by far, is tourism. In the June 2026 quarter, it was valued at $315 million. That’s 49% of New Zealand’s entire exports to India in the June quarter, goods and services alike. Tourism also represents our largest import from India, at $68 million in the June 2026 quarter.
People flows between our two countries is not just about short-term visitors. India has been a key source of migrants for us, supporting net migration levels and creating a vibrant diaspora of Indian communities thriving in Aotearoa.
There is still a lot of untapped potential here. The recently ratified free trade agreement (FTA) has the potential to take our trading relationship from solid to strong.
Why does a strong trading relationship with India even matter? For one thing, India’s economy is growing rapidly, and its 1.4 billion strong population provides a massive consumer base for Kiwi businesses to tap into. And it goes both ways. India is transforming into an industrial powerhouse, supplying Kiwi consumers and businesses with a growing range of goods and services that can make us better off.
The FTA will ensure New Zealand exporters will face fewer barriers to exporting to India over time. 57% of exports will see a complete removal of tariffs from day one (October 20th!) rising to 82% over time. A further 13% of exports will still face some tariffs but at a steep reduction in the tariff rate over time. For more details on the specific arrangements set out in the FTA, see the Ministry of Foreign Affairs and Trade’s website here.
We will be keenly awaiting to see how relationship evolves from here. We hope to see an increase in both imports and exports, benefitting consumers and businesses alike.
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