Joint committee with representatives from both countries, a DPIIT committee to keep track of investment flow, say official sources
The India-New Zealand FTA will be implemented after legal vetting from both sides and clearance from New Zealand Parliament.
New Zealand’s commitment to facilitate $20 billion in private sector investment to India over 15 years–a significant gain for India from the newly concluded bilateral free trade agreement (FTA)–has a strict timeline with no built-in grace period, unlike India’s pact with the EFTA bloc, sources have said.
New Delhi can decide to “claw back” some of its concessions to New Zealand at the end of the 15 year period if the investment target is not met.
India’s FTA with the EFTA countries, which includes Switzerland, Norway, Iceland, Liechtenstein, implemented earlier this year, has a commitment of $100 billion of private sector investments over 15 years, but it has an in-built grace period of three years.
“It will be up to India to decide if New Zealand has seriously pursued its commitment to promote $20 billion investments at the end of the 15 year period. In case it is observed that most of the investments have been made and the shortfall is very little, it will be Delhi’s prerogative to grant some grace time,” a source tracking the matter told businessline.
If the investments are not satisfactory, then India can take ‘remedial action’ such as withdrawing tariff benefits on certain items, that could be decided at that point of time, the source added.
“The investment commitment of $20 billion from New Zealand is a big gain for India as right now total investment flow is less than $ 1 billion. India will keep a keen eye on it,” the source said.
To ensure accountability, a joint committee with representatives from both sides will be set up to keep track of the investments and related issues while the Department for Promotion of Industry and Internal Trade (DPIIT) will set up its own committee to monitor the flows, the source said.
The $20 billion investments flowing from New Zealand private sector is expected to support manufacturing, infrastructure development, innovation, and employment generation, the source said.
“The Investment Cooperation and Promotion Chapter provides for broad cooperation between New Zealand and India in an effort to deepen the trade and investment relationship. The chapter sets out cooperation activities that may take place such as trade delegations, workshops, and events to promote two way investment and build the investment relationship between our two countries,” according to a New Zealand government public note.
The chapter also includes a commitment for New Zealand to promote investment into India with the aim to increase private sector investment by $20 billion over 15 years, it said, adding that it applied only to private sector investment.
“The chapter is not subject to dispute settlement, including Investor-State Dispute-Settlement, though there is a ‘remedial’ process available to India,” the note added.
To facilitate New Zealand investments, India will establish a ‘New Zealand Investment Desk’ to assist New Zealand investors with any issues that arise across the investment life-cycle.
Apart from attracting investments, India holds the potential to increase its exports of goods to New Zealand substantially, per an analysis by research body Global Trade and Research Initiative.
Zero-duty access
The pact, offering zero-duty market access to all goods from India, can benefit sectors such as processed foods, pharmaceuticals, machinery, electronics, vehicles, aerospace components and furniture, it said.
In FY2025, New Zealand imported goods worth $711 million from India, which was less than 1.5 per cent of its total imports of $50 billion, it said
The India-New Zealand FTA will be implemented after legal vetting from both sides and clearance from New Zealand Parliament.
Published on December 28, 2025
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