India's Economic Rise Poised to Boost NZ Trade Deal Gains

A new report from Westpac Institutional Bank highlights the potential benefits of New Zealand's recently signed free trade agreement (FTA) with India. According to the report, India's economic rise makes it a strategic partner for New Zealand, and the FTA is expected to deliver significant gains.

The report notes that India is one of the world's fastest-growing major economies and offers access to a market of 1.4 billion people, one fifth of the world’s population. Under the FTA, 95 per cent of New Zealand's current exports gain tariff elimination or substantial tariff reductions.

Estimated tariff savings of around NZ$43 million annually from day one, rising to about NZ$62 million when fully implemented based on current trade levels. The report calls India a global economic powerhouse and is expected to become the world's third-largest economy this decade due to rapid growth in incomes and consumer spending.

India's middle class is expected to exceed the entire population of the EU or ASEAN within five years, increasing its influence in global trade, technology, investment, and geopolitics. The FTA also holds benefits related to strategic relations and economic diversification, especially important in the current geopolitical environment.