Coalition Govt split over Indian FTA
The Coalition Government will need the support of at least one opposition party to ratify the free trade deal with India.
India, with its teeming billions, is seen as a country which offers an attractive new market for some but not all of our primary produce.
Right now, the main NZ primary exports to India are forestry and wool and few apples. In the latest statistics from MPI, India hardly features. The new Government clearly wants this to change and we’ve already seen Trade Minister Todd McClay head to India just before Christmas and Foreign Affairs Minister, Winston Peters just a week or so ago. Prime Minister Chris Luxon has also said he’ll go there.
So, the courtship of one of the most powerful economies in the world is now in overdrive and for good reason.
Australia got the jump on us when it signed an FTA with India in 2022, which has seen tariffs cut on Australian exports including lamb and wool, wine, avocados and infant formula to name a few.
So where the bloody hell has sleepy old Kiwiland been?
When Sir Edmund Hillary became our High Commissioner to India in 1985 there was clearly a massive opportunity to get the drop on the Aussies and others. Hillary – supported by the PM at the time, David Lange – had a great relationship with India but since then it seems the lights have gone out and nothing much has happened. The Hillary factor was huge; just like Rewi Alley played a significant role in opening up the Chinese market for NZ.
Australia apparently used cricket in their courtship of India and one hopes there was no match fixing in the process.
Does NZ do the same? We have some excellent sports people playing in that country at the moment.
One trade insider claims that NZ has not ‘courted’ the Indians properly and in the way they might expect. They believe the process of obtaining any Indian trade deal is slow and showing respect and heaping praise on them is part of the deal. Whatever has happened in the past is now history and it seems that the coalition Government is making a deal with India a top priority.
The problem is that any deal is likely to exclude dairy products given that India has a large domestic industry and is highly protective of it. So, any deal NZ ever gets with India will not be as ‘comprehensive’ as the FTAs with the UK and the EU but a deal of any sort is better than no deal. Watch this space!
