# Zero Duty on Indian Goods as New Zealand Free Trade Pact Takes Effect This Dussehra

> India and New Zealand will implement their bilateral Free Trade Agreement on October 20, 2026, granting zero custom duties to all Indian shipments.

**Type:** article · **Category:** Business · **Published:** 2026-09-22 · **Source:** TrendKia
**Canonical:** https://trendkia.com/en/business/dashahara-se-shunya-kastama-dyuti-para-new-zealand-bheje-jaenge-bharatiya-utpada-aitihasika-mukta-vyapara-samajhaute-ki-tarikha-ta-36140 · **Language:** English
**Tags:** India New Zealand Trade, Free Trade Agreement, Piyush Goyal, Christopher Luxon, Indian Exports, Auto Components

A major commercial breakthrough is set to reshape trade corridors between South Asia and Oceania ahead of the autumn festive period. Following high-level discussions in a virtual press briefing held in New Delhi, Union Minister of Commerce and Industry Piyush Goyal and New Zealand Trade Minister Todd McClay formally finalised the rollout schedule for the bilateral Free Trade Agreement. The historic pact will officially enter into force on October 20, 2026, coinciding with Vijayadashami.

## Full Tariff Waiver on Indian Shipments
Under the terms of the comprehensive framework, zero customs duty will apply across 100 percent of goods exported from India into New Zealand. Previously, Indian shipments encompassing passenger cars, automotive components, carpets, ceramics, and textiles faced import levies reaching up to 10 percent. Starting October 20, these tariffs will be dismantled entirely, rendering Indian manufactured automobiles, engineering parts, and artisan merchandise significantly more cost-competitive for buyers across New Zealand.

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## Targeting Thirty-Five Thousand Crore Bilateral Exchange
Both nations have outlined a shared vision to scale their cumulative trade in goods and services to roughly 4 billion dollars, or about ₹35,000 crore, across the next four to five years. The diplomatic groundwork for this accelerated schedule was solidified in July 2026 during Prime Minister Narendra Modi's official journey to New Zealand. That visit marked the first official tour by a sitting Indian head of government to the country in four decades, providing essential momentum to resolve outstanding regulatory discussions.

## Expanding Trade Volumes and Job Prospects
Welcoming the development, New Zealand Prime Minister Christopher Luxon observed that his administration has fulfilled its early-tenure pledge of delivering a comprehensive trade pact with India. Official statistics reveal that trade between the two partners expanded rapidly from 873 million dollars in 2023-24 to 1.3 billion dollars during 2024-25, marking an impressive growth rate of 49 percent. Industry analysts expect the tariff-free corridor to stimulate key export engines including pharmaceuticals, textiles, and information technology while opening thousands of domestic employment avenues.

## What this means for you
The pact provides domestic automobile part makers, textile producers, and artisans direct tariff-free access to the New Zealand market.

- **For Exporters:** All Indian goods shipped to New Zealand will attract zero customs duty starting October 20, 2026. This allows domestic cars, ceramic tiles, and handloom rugs to compete at lower prices without the previous 10 percent levy.
- **Industrial Jobs:** Accelerated demand across pharmaceuticals, software, and fabric production is slated to create thousands of manufacturing opportunities. Domestic enterprises can pitch for larger supply orders without facing import cost penalties.
- **Bilateral Growth:** Total trade is targeted to touch ₹35,000 crore within the next four to five years. Small and medium manufacturing units will gain direct entry into Pacific supply chains.
- **Commercial Trajectory:** Two-way trade recorded a 49 percent jump to reach 1.3 billion dollars in 2024-25. Eliminating entry tariffs further secures consistent overseas order books for specialized Indian engineering sectors.

## Why this happened
The finalization of this trade agreement follows years of negotiations accelerated by high-level diplomatic outreach and surging bilateral exchanges.

- **Diplomatic Momentum:** Prime Minister Narendra Modi traveled to New Zealand in July 2026, marking the first such visit by an Indian prime minister in four decades. That diplomatic engagement provided the necessary political impetus to finalize the terms.
- **Expanding Trade Baseline:** Two-way trade volume surged from 873 million dollars in 2023-24 to 1.3 billion dollars in 2024-25. This 49 percent annual spike demonstrated strong commercial demand, encouraging negotiators to set a definitive rollout date.
- **Policy Commitments:** The administration led by Prime Minister Christopher Luxon had pledged early in its tenure to deliver a dedicated trade corridor with India. A virtual dialogue between both trade ministers concluded the technical details for the festive launch.

## Questions & Answers

### 1. When does the India New Zealand Free Trade Agreement come into effect?
The bilateral trade pact is scheduled to be enforced starting October 20, 2026, on Vijayadashami.

### 2. What customs duty will Indian goods face in New Zealand under this deal?
A zero customs duty will apply to 100 percent of Indian goods exported to New Zealand.

### 3. What tariffs were previously imposed on Indian goods?
Indian shipments of cars, auto components, ceramics, and textiles faced import duties of up to 10 percent.

### 4. What is the targeted trade volume for the coming years?
Both countries aim to scale bilateral goods and services trade to roughly 4 billion dollars, or about ₹35,000 crore, over the next four to five years.

### 5. How much did bilateral trade grow in 2024-25?
Two-way trade between both nations grew by 49 percent to reach 1.3 billion dollars in the 2024-25 financial year.

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