The India-New Zealand free trade agreement (FTA), set to come into force on October 20, could open up a $6-billion market for Indian exporters, with pharmaceuticals, gems and jewellery, machinery and manufactured goods among the biggest potential beneficiaries, according to a Moneycontrol analysis of trade data.

The opportunity lies primarily in product categories where New Zealand already imports substantial quantities from the rest of the world but sources little or nothing from India, despite Indian exporters having an established global presence.

Of the 2,871 product categories in which New Zealand imported goods worth $47.5 billion in 2024, India had negligible exports in 1,144 categories, representing a combined import market of around $6 billion. In another 506 categories worth $2.3 billion, Indian shipments were below $1,000.

India exported just $742 million worth of goods to New Zealand in 2024.

Pharmaceuticals, machinery offer substantial headroom

Pharmaceuticals represent one of the largest opportunities. India exported nearly $20 billion worth of pharmaceutical products globally in 2024, but shipments to New Zealand amounted to just $69 million, against the country's total pharmaceutical imports of $763 million.

In immunological products, where New Zealand imported nearly $140 million worth of goods, it sourced virtually nothing from India, even though Indian exporters shipped around $300 million globally.

New Zealand imported nearly $60 million worth of forklifts, while India's global exports stood at $141 million, with negligible shipments to New Zealand. In grapes, New Zealand imported $48.3 million, with India accounting for only a marginal share.

Diversification amid Gulf disruptions

The FTA also assumes significance amid disruptions to trade routes in West Asia.

An earlier Moneycontrol analysis found that New Zealand’s import demand could provide an alternative market for at least 12 percent of India’s exports currently exposed to the Strait of Hormuz, assuming prolonged disruptions and a weak demand recovery in affected Gulf economies.

Products with potential demand include food preparations, machinery, medical instruments, electrical equipment, cosmetics and plastics.