India Gives Duty-Free Access to 54.11% of New Zealand Exports from Day One of FTA

India will give duty-free access to 54.11 per cent of New Zealand exports from day one of the implementation of the free trade agreement, and these goods include sheep meat, wool, coal and several forestry and wood products, a move which is expected to make these items cheaper for Indian consumers.

India has also given duty concessions on agricultural goods like apples, kiwifruit, manuka honey, and albumins (including milk albumin), but with quotas and minimum import prices (MIP).

Zero import duty or a reduced tariff will make these goods cheaper for Indian customers.

The two countries on Monday announced the conclusion of the FTA (free trade agreement) negotiations. The pact is likely to be implemented after the signing of the document, and the process may take about 7-8 months from now.

"Duty-free access is provided on 54.11 per cent of New Zealand exports from day one, based on 2024 data," the commerce ministry said, adding that the zero-duty access for New Zealand exports will increase to 79 per cent after 10 years.

Under the pact, import duties on several seafood items such as mussels and salmon will be eliminated over a period of seven years.

Similarly, duty will be removed on a number of iron, steel and scrap aluminium items over a period of 10 years or less. It was demanded by the Indian industry.

These goods are used as inputs for the Indian industry, and the duty concessions have been given to ensure cost-effective manufacturing in India, the ministry said.

Sensitive farm products, including apple, kiwifruit, manuka honey, and albumins (including milk albumin), are managed through tariff-rate quotas (TRQs), supported by minimum import prices (MIP) and safeguard measures.

At present, New Zealand is exporting 23,602 tonnes (MT) of apples to India at 50 per cent import duty.

Under the agreement, India has given duty concessions on a quota of 32,500 MT in the first year of the implementation of the pact. The quota will be increased up to 45,000 MT in the sixth year at 25 per cent duty and an MIP of USD 1.25 per Kg.

Beyond this quota, a 50 per cent duty will be imposed.

"These are very conservative levels of quota, below their current level of imports," the ministry said.

India has a 33 per cent import duty on kiwifruit. The current imports from New Zealand are 5,840 MT.

India is giving duty concessions for up to 6,250 MT in the first year, and the quota will be increased to 15,000 MT in the sixth year to nil duty and USD 1.80 per Kg MIP. The increased quota is 2.6 times the current level of imports.

Further, import duty on avocados and persimmons will be eliminated in 10 years. This was also included in the FTA between India and Australia.