New Delhi: India’s growing stature on the global trade stage is increasingly evident in the way it is shaping trade agreements on its own terms. In its recently concluded Free Trade Agreement (FTA) negotiations with New Zealand, India has firmly safeguarded the interests of its farmers, especially those linked to the dairy sector, by keeping agricultural and dairy products completely out of the pact.
After nine months of negotiations, both countries agreed that the FTA would proceed without opening India’s sensitive agriculture and dairy markets. This decision is being seen as a major policy success, particularly in contrast to India’s earlier refusal to allow agricultural imports from the United States, a stance that had led to higher tariffs imposed by the US. Instead of yielding, India adopted a patient approach, finalising balanced trade agreements with the UK, Oman and now New Zealand, while prioritising domestic interests.
The agreement is notable as it will operate largely on zero-tariff terms for non-agricultural sectors, benefiting professionals such as the nearly 5,000 Indian engineers working in New Zealand. At the same time, India has avoided the risk posed by the influx of cheap dairy products, a concern that had earlier prompted New Delhi to stay out of the Regional Comprehensive Economic Partnership (RCEP).
India will allow imports of select New Zealand products such as apples, kiwis, honey and wine, with significant tariff concessions. New Zealand will also extend technical assistance to improve productivity in India’s horticulture and dairy sectors.
The decision underscores India’s commitment to protecting the livelihoods of nearly eight crore people dependent on dairy farming, a sector that forms a vital pillar of the rural economy. With its firm stance, India has reinforced that trade liberalisation will not come at the cost of farmers’ livelihoods or cultural and economic security.
