India-New Zealand FTA: PM Luxon hails deal after Winston Peters slams it
India-New Zealand FTA triggers political rift in New Zealand, with PM Luxon backing the pact and Winston Peters slamming it as unfair
As the India-New Zealand Free Trade Agreement (FTA) faces criticism from that country's foreign minister Winston Peters, prime minister Christopher Luxon on Saturday (December 27) described the pact as a “landmark deal,” saying it would create jobs, raise wages and boost exports by opening access to India’s 1.4 billion consumers.
The New Zealand PM further stated that the FTA was part of his government’s broader agenda, stating, “Fixing the Basics. Building the Future.”
“We said we’d secure a Free Trade Agreement with India in our first term, and we’ve delivered. This landmark deal means more jobs, higher incomes and more exports by opening the door to 1.4 billion Indian consumers. Fixing the Basics. Building the Future,” stated Luxon in a post on X.
Foreign Minister slams FTA
However, contrary to the New Zealand PM’s praise of the deal, his cabinet colleague and coalition partner, New Zealand First (NZF) party chief, Foreign Minister Winston Peters, slammed the FTA earlier as “neither free nor fair.”
The NZF chief further stated that he had conveyed his reservations against the deal to his Indian counterpart S Jaishankar, adding that he had “utmost respect” for him.
Also Read: India, New Zealand seal free trade pact
Peters further alleged that the agreement was lopsided as it gave too much away to India while not ensuring enough gains for New Zealand. He said that the NZ F had warned its coalition partner not rush with the FTA negotiations with India without a broad political consensus.
“New Zealand First urged its coalition partner not to rush into concluding a low-quality deal with India, and to use all three years of this Parliamentary cycle in order to get the best possible deal,” Peters stated in a post on X.
‘Speed over substance’
Alleging the government prioritised speed over substance about the FTA with India, Peter stated, “National preferred doing a quick, low-quality deal over doing the hard work necessary to get a fair deal that delivers for both New Zealanders and Indians.”
Also Read: NZ foreign minister Peters slams India FTA as ‘neither free nor fair’
Lack of market access to India’s dairy sector turned out to be a major irritant for the New Zealand Foreign Minister with regard to the FTA. He argued that while New Zealand has fully opened its market to India, the move was not reciprocated by New Delhi by removing tariff barriers on Indian imports of key dairy products.
“This is not a good deal for New Zealand farmers and is impossible to defend to our rural communities…,” stated Peters, adding that it would be New Zealand’s first trade deal to exclude our major dairy products, including milk, cheese and butter.
The backdrop
The FTA was unveiled earlier this week following discussions between Prime Minister Narendra Modi and his New Zealand counterpart. The two leaders said the pact has the potential to nearly double bilateral trade over the next five years and could generate investments of around $20 billion in India over 15 years.
Formal negotiations on the agreement began in March. Announcing the deal, PM Modi and Luxon said it underscored the “shared ambition and political will” of both countries to further strengthen and expand their bilateral relationship.