NZ–India trade deal delivers major win for Waikato and Taranaki — but dairy questions remain

New Zealand’s free trade agreement with India is now in effect. From today, 20 October 2026, the deal lowers barriers to one of the world’s largest markets, giving New Zealand exporters new opportunities to sell their products into India.

For Waikato and Taranaki, that means new possibilities for sheep farmers, forestry and honey producers, and the businesses that support them. But with both regions heavily reliant on dairy, what the agreement leaves out matters as much as what it delivers.

Answering questions about Waikato and Taranaki specifically for The Waikato Advocate, India New Zealand Business Council (INZBC) Chief Executive Sunil Kaushal says the agreement could provide a significant boost to regional economies, particularly through sheep meat, forestry, mānuka honey and agricultural technology.

From entry into force, 57 percent of New Zealand's existing exports to India become tariff-free, eventually increasing to 82 percent as the agreement is implemented.

With two-way trade already worth $3.95 billion annually, both governments have set an ambitious target of reaching $7 billion by 2030.

Read Sunil Kaushal’s full written interview and the INZBC launch statement →

A big win for regional farmers

For sheep farmers across Waikato and the Taranaki hill country, one of the biggest victories is the immediate removal of India's 33 percent tariff on New Zealand sheep meat.

Kaushal revealed that New Zealand previously supplied around 85 percent of India's imported sheep meat. However, after Australia secured tariff-free access, New Zealand's share collapsed to approximately 9 percent.

“The FTA puts our farmers back on a level playing field.”

The benefits could extend beyond the farm gate, with increased exports potentially supporting meat processors, transport operators, rural contractors and local businesses.

Other major opportunities include:

Mānuka honey: India's 66 percent tariff will fall to 16.5 percent over five years for eligible exports. MFAT specifies a minimum price of US$30/kg, with a 200-tonne quota for exports priced at US$20–30/kg.

Forestry: More than 95 percent of existing forestry exports become tariff-free immediately.

Wool: Tariffs removed from day one.

Agritech: New opportunities for Waikato businesses developing agricultural machinery, technology and farming innovations.

Government modelling cited by Kaushal estimates New Zealand's agri-food and forestry exports to India could be $260 million higher annually in 2027 than without the agreement.

But what about Waikato and Taranaki dairy?

Despite the positive developments, one of the biggest questions surrounds dairy.

Both Waikato and Taranaki depend heavily on milk production and processing, yet most mainstream dairy products remain excluded from India's tariff concessions.

"This is a very good primary-sector agreement, but it is not a comprehensive dairy agreement," Kaushal acknowledged.

Some specialist products, including bulk infant formula and certain dairy-based food preparations, will receive phased tariff reductions over seven years.

However, the agreement stops short of delivering broad tariff-free access for the regions' dairy exporters.

Could households benefit too?

The agreement also removes New Zealand's remaining tariffs on Indian imports, potentially reducing prices on clothing, footwear, textiles, machinery and some manufactured goods.

But Kaushal believes the greater regional benefit will come through increased export earnings circulating through local economies.

Official modelling anticipates higher real wages and increased employment in agri-food sectors, although overall employment gains are expected to be relatively modest.

For smaller businesses, Kaushal says India presents enormous opportunities, but success will depend on taking a targeted approach.

"Start with one product, one part of India and one trusted partner."

He pointed to India's rapidly expanding middle class and encouraged regional exporters to establish relationships with suitable distributors rather than attempting to enter the entire Indian market.

The INZBC is also planning workshops across the regions to help businesses understand and take advantage of the agreement.

What happens next?

While today's agreement represents a significant opportunity for Waikato and Taranaki, Kaushal says the real test will come over the next 12 months.

He will be watching whether New Zealand sheep meat regains market share, whether mānuka honey exports grow, and whether more regional businesses successfully enter the Indian market.

"India is a relationship-driven market and some benefits will take several years," he explained.

For Waikato and Taranaki, the agreement offers a chance to strengthen rural incomes, support regional businesses and develop new international partnerships.

But three important questions remain: Will sheep farmers regain lost market share? Can smaller regional businesses turn the agreement into real export growth? And will India's dairy market eventually open further to New Zealand?

For now, the trade barriers have been lowered. The challenge is ensuring the benefits reach the communities that power our regional economies.

The Waikato Advocate | In partnership with The Ngāmotu Advocate

Source: Interview answers supplied to The Waikato Advocate by INZBC Chief Executive Sunil Kaushal; INZBC media release, 20 October 2026.