India and New Zealand have resumed free trade negotiations after a ten-year pause, marking a significant diplomatic development during New Zealand Prime Minister Christopher Luxon‘s five-day visit to Delhi. After bilateral discussions with Indian Prime Minister Narendra Modi, the two nations announced that formal negotiations will begin next month.
Prime Minister Luxon described the restart as a “major breakthrough” in economic relations between the countries. He emphasized India’s importance in New Zealand’s economic strategy, stating that India will play a “pivotal role” in his country’s plan to double export values over the next decade. Currently, bilateral trade between the two nations stands at under $2 billion.
Beyond trade, the leaders signed a defense cooperation agreement focused on maritime security and discussed potential collaboration in digital payments. The visit coincides with broader security engagements, including a conference of intelligence chiefs in Delhi attended by representatives from the Five Eyes alliance, which includes New Zealand.
For India, strengthening ties with New Zealand aligns with its interests in countering Chinese influence in the Indian Ocean region. The significance of this diplomatic mission is underscored by the unusually large delegation accompanying Prime Minister Luxon.
Previous trade talks that began in 2010 stalled over market access issues, particularly regarding New Zealand’s dairy industry seeking entry into India’s protected agricultural market. However, India’s approach to free trade has evolved in recent years, with the country actively pursuing bilateral agreements.
This development follows India’s recent trade initiatives, including renewed negotiations with the European Union and United Kingdom, a $100 billion agreement with the European Free Trade Association, and a major deal with Australia. The renewed focus on trade partnerships comes as India faces potential challenges from U.S. President Donald Trump’s upcoming tariff policies set to take effect in April.
Last updated: December 26th, 2025
