India, New Zealand Sign $20 Billion FTA but Exclude Dairy to Shield 80 Million Livelihoods
Updated
Updated · linkedin · May 20
India, New Zealand Sign $20 Billion FTA but Exclude Dairy to Shield 80 Million Livelihoods
2 articles · Updated · linkedin · May 20
April 27's India-New Zealand free trade agreement left dairy outside the pact, preserving protections for a sector tied to about 80 million Indian livelihoods.
Up to 60% import duties remain in place because New Zealand's lower-cost dairy exports could undercut India's fragmented market, where more than 80% of producers are small farmers or vendors.
India's dairy industry is central to the economy—worth ₹18,975 billion in 2024, supplying 24% of global milk output and contributing roughly 33% of rural household gross income.
The broader deal still aims to deepen ties, with bilateral trade at $1.3 billion in 2024-25 expected to double and New Zealand committing $20 billion in investment across other sectors.
The FTA's $20 billion investment is not binding. What happens if New Zealand's big promise to India falls short?
Will protecting 80 million farmers mean Indian consumers must face permanently rising milk prices?
On April 27, 2026, India and New Zealand signed a landmark Free Trade Agreement in New Delhi, marking a major step in strengthening their economic partnership. The FTA is designed to deepen ties by boosting trade, investment, and professional exchanges. Its immediate goals include providing extensive market access, attracting significant foreign direct investment, and making it easier for skilled professionals to move between the two countries. A key feature is 100% duty-free access for a wide range of goods, which is expected to reduce trade barriers and make products more competitive in both markets.