Bay of Plenty exporters are emerging as early winners from New Zealand’s new free trade agreement with India, which removes barriers and opens preferential access to one of the world’s fastest growing markets. David Porter and Mary Anne Gill investigate.
Todd McClay the minister of Trade & Investment, with at left Vangelis Vitalis, Ministry of Foreign Affairs and Trade chief negotiator and his Excellency Dr Madan Mohan Sethi, Indian Consul General to New Zealand. Photo: Mary Anne Gill
A Free Trade Agreement between New Zealand and India is reshaping export prospects for Bay of Plenty businesses, with tariff reductions and new market certainty expected to drive growth across food, forestry and value‑added manufacturing.
Trade and Agriculture Minister Todd McClay says the agreement dismantles obstacles that have historically limited New Zealand’s competitiveness in India, eliminating or reducing tariffs on 95 percent of exports. More than half will be duty‑free from day one, rising to over 80 percent once the deal is fully implemented.
Bay of Plenty Business News April 2026
The agreement gives regional exporters greater confidence to invest, he says. Certainty at the border makes businesses more willing to commit capital, build supply chains and form long‑term relationships.
That certainty now applies to a market of 1.4 billion people, including a rapidly expanding middle class with a growing appetite for premium food products, processed timber and specialist manufacturing – areas where Bay of Plenty firms already have strong capability.
Priority One chief executive Dave Courtney says free trade agreements create momentum that builds over time for regional exporters.
“When you’ve got the relationship and trade starts to flow, you have the ability to refine it and improve the agreement over time,” he says.
Tauranga‑based mānuka honey producer Comvita is among the companies assessing what the agreement could unlock. India has, for the first time in any free trade agreement, agreed to preferential market access for mānuka honey, alongside apples and kiwifruit.
Karl Gradon
“The India trade deal is a milestone for Aotearoa New Zealand,” Comvita chief executive Karl Gradon says.
“We’re hopeful that with this new market opening, more global customers will be able to access the proven benefits of mānuka honey.”
Bay of Plenty’s horticulture and apiculture sectors are widely seen as well positioned as tariff reductions improve competitiveness for premium products in a price‑sensitive market. The agreement also delivers what McClay describes as a world‑first outcome for kiwifruit, with duty‑free access for a large quota – nearly four times current export volumes – and a reduced tariff applying outside that quota.
Forestry and wood processing also loom large for the region, particularly as India looks beyond raw log imports to higher‑value building materials and structural timber. New Zealand previously exported about $300 million worth of wood products to India, trade which stalled after regulatory changes around fumigation. Those issues have now been resolved and log exports have resumed, but the greater opportunity lies in processed timber.
“Our preference is value‑added products, not just logs,” says McClay.
Dave Courtney
“The more processing done in New Zealand, the better the outcome for jobs and regional growth.”
He rejects suggestions that New Zealand lacks processing capacity, pointing to reopened and expanding mills in places such as Whakatāne exporting structural timber into overseas markets.
The agreement is also designed to level the playing field in sectors where tariffs have previously distorted competition.
McClay points to lamb exports as a cautionary example. Before Australia signed its own agreement with India in 2022, New Zealand supplied about 89 percent of India’s imported lamb. Today, around 91 percent comes from Australia.
“That’s not because Australian lamb is better,” he says.
“It’s because a 30 percent tariff at the border makes it almost impossible to compete. When that drops to zero, we’re back on an equal footing – and I back Kiwi farmers to do very well.”
While dairy access remains politically sensitive for India, the agreement still delivers gains for higher‑value dairy products manufactured in Waikato and Bay of Plenty. New Zealand has secured access for high‑value dairy proteins, as well as a pathway for infant formula to move to tariff‑free over time.
Simon Devoy
McClay highlights “import for re‑export” opportunities, where New Zealand dairy ingredients can be processed or blended in India and then exported into markets where India already has trade agreements. That model is attracting interest from both Indian companies and New Zealand firms considering manufacturing or joint‑venture opportunities offshore.
Beyond goods, the agreement places increased emphasis on services, investment and skills. India is investing heavily in infrastructure, education and urban development, creating opportunities for New Zealand companies in engineering, design, project management, agri‑services and financial technology.
The deal includes expanded services coverage and a most‑favoured‑nation clause to future‑proof access if India later offers better terms to other trading partners. India has also committed to a single‑desk investment facilitation service for New Zealand businesses, while New Zealand will actively promote itself as an investment destination.
To support growth at home, the agreement establishes a process for an average of 1667 skilled three‑year work visas per year, focused on areas of genuine skills shortage such as healthcare, engineering, ICT and teaching. The visas are temporary and non‑renewable.
Regional economic leaders say the agreement’s value will ultimately depend on how effectively businesses use it.
Todd McClay speaking at the New Zealand-Indian Free Trade Agreement function. Photo: Mary Anne Gill
Free trade agreements are as much about building relationships as they are about tariff schedules, says Courtney.
“Trade follows. Once you’ve got the relationship and trade starts to flow, you have the ability to refine and improve the agreement over time.”
Simon Devoy, the Employers and Manufacturers Association (EMA) head of Membership and Export, says the free trade agreement is a “game changer”.
“This agreement opens huge opportunities. Nearly all of our major exports, from sheep meat to mānuka honey, will see significant tariff relief,” he says.
“It is a chance for Kiwi businesses to connect directly with Indian markets. We’re seeing opportunities across agriculture, tech, healthcare and more.”
For Bay of Plenty exporters, the door to India is now open – and the advantage will lie with those ready to step through it.
Forestry, kiwifruit and honey – set to be big winners under the deal.
