India Free Trade Agreement Legislation Amendment Bill

I move, That the India Free Trade Agreement Legislation Amendment Bill be now read a second time.

The Foreign Affairs, Defence and Trade Committee has carefully considered the bill, and I want to thank the members of the committee and officials for their work. The committee also took the time to carefully consider all submissions, and I commend them for that approach. I recognise that they worked incredibly hard to scrutinise the legislation in tight time frame, including when Parliament was in session, to make the necessary recommendations and to have the bill ready for the House today. The committee has also recommended technical amendments to the bill.

The committee has recommended amendments to Part 1 and Part 4 of the bill, and I welcome those amendments. Part 1 of the bill establishes a new quota for the export of milk albumin to India. It amends the Dairy Industry Restructuring Act (DIRA) 2001 to incorporate the albumin quota that we secured under the free-trade agreement (FTA) into New Zealand’s existing diary quota export licensing regime. Part 1 adds India as a designated market for albumin exports and provides for a regulation-making power to enable up to 10 percent of export licences to be reserved for smaller and new exporters.

The addition of clause 7A, inserting new section 26C, will provide flexibility if the FTA enters into force on a date other than 1 January. In that circumstance, quota must be allocated on a pro rata basis, to reflect the proportion of the quota year remaining. This allows New Zealand albumin exporters to benefit from improved access to the Indian market and provides certainty for exporters during a partial quota year. This is consistent with arrangements for other FTAs that have been given effect to under DIRA.

Part 4 of the bill establishes the framework for quota management systems for apples, kiwifruit, and mānuka honey. It enables regulations to set up systems to allocate quota return or transfer quota, issue export certificates, and provide information to Indian authorities. The amendments recommended by the select committee are largely technical and operational in nature, reflecting issues identified by officials during the development of the regulations and matters raised by submitters and the committee. Collectively, these amendments improve the clarity, transparency, and workability of the quota management system established under the bill.

The amendments strengthen the administration of quota arrangements. They improve quota manager requirements, transparency of quota allocations, audit arrangements, compliance and quota allocation, and management mechanisms. These amendments and the other minor technical changes are about striking the right balance, protecting the integrity of New Zealand’s quota management systems while ensuring enforcement powers are clear, proportionate, and consistent with those available under comparable regulatory regimes. No amendments were recommended for Part 2 or Part 3 of the bill.

The India FTA is one of the most significant trade agreements that New Zealand has secured in decades. Before I go on, I just want to recognise that, in the committee stage, the bill will be split in half, which is normal practice, so that the quota management is a separate piece of legislation. I do want to recognise, from discussions with the Hon Damien O’Connor, that whilst the committee might have been informed later in the stage—if there is any understanding around that that is different, I want to offer an apology for it—it is exactly the same as what happened with the UK FTA. It’s standard practice in the House.

The FTA opens the door to the world’s fastest-growing major economy, a country of 1.4 billion people and a middle class expected to reach 700 million consumers by 2030, and a GDP expected to reach $12 trillion in that same year. At a time of rising global uncertainty, New Zealand needs more customers, more markets, and more opportunities. As a small exporting nation, with one in four New Zealand jobs linked to exports, we depend on rules, relationships, and agreements to ensure our economic security and prosperity. FTAs, particularly with growing economies, allow our world-class exporters access to markets otherwise blocked. Growing exports means growing incomes, investment, and opportunities.

Once implemented, this agreement will create new opportunities and a level playing-field for most New Zealand exporters, relative to their competitors currently trading under their own agreements. Australia, the United Kingdom, and the European Union have all concluded FTAs with India, and we cannot afford to be left behind. In the first two years of the Australian FTA, with India, entering into force, its forestry exports to India surged 119 percent whilst ours fell 19 percent during the same period. Our share of sheep meat also dropped dramatically once Australia’s FTA with India entered into force. We used to provide 85 percent of India’s sheep meat imports, and this fell to 9 percent since Australia signed their FTA, with Australia now representing 91 percent of India’s sheep meat imports.

The agreement restores New Zealand’s competitiveness and puts our exporters back on a level playing field. The numbers speak for themselves. From day one of entering into force, 57 percent of our current exports will enter India duty free. This rises to 82 percent over 10 years when fully implemented. Another 13 percent will benefit from sharp tariff cuts. This means that tariffs on 95 percent of our current exports will be eliminated or sharply reduced. Tariff elimination on day one for a range of key products—including forestry, sheep meat, and wool—will ensure immediate benefits for exporters in those sectors. For goods like seafood, most industrial products—including iron and steel, bulk infant formula, cherries, and avocados—will see tariff elimination over periods of seven to 10 years. Other key exports like apples and kiwifruit have secured sizable duty-free quotas that offer commercially meaningful access into the market and additionally 50 percent out-of-quota tariff reduction for kiwifruit. Mānuka honey will benefit from a sharp reduction in tariffs over five years. On dairy, tariffs on bulk infant formula, other dairy-based preparations, and peptones will be phased out over seven years, while tariffs on albumins will be halved within a quota covering recent trade.

Beyond new market access, the deal offers more certainty for our services exporters, for investors, and for Kiwi businesses looking to increase their footprint in India. India has made commitments on almost 100 additional sectors above its World Trade Organization (WTO) commitments, including, crucially, a most favoured nation commitment for services. This means that any better access India offers future FTA partners in key services sectors will automatically flow through to New Zealand and that our agreement gets better over time. This is the case with the FTA concluded with the European Union and India. New Zealand will benefit more by passing this legislation and putting the agreement in force before the EU’s FTA.

This agreement strengthens more than our economy, and the New Zealand - India FTA will also assist the development of stronger trade, economic, cultural, and people to people links between our two countries. The legislation before the House is straight forward. New Zealand has secured this deal with India in record time—vital for our exporters and the Government’s goal of doubling the value of exports over 10 years. It will create opportunities for farmers, growers, manufacturers, innovators, service exporters, and small businesses across New Zealand. The India FTA stands to serve our economy, our exporters, and our future, and I commend the bill to the House.

ASSISTANT SPEAKER (Greg O'Connor): The question is the motion be agreed to.

Thank you, Mr Speaker. Labour rises to support this bill and this trade agreement. The Minister has said this is one of our most significant trade agreements. We do have to make a mountain from a molehill to achieve that agreement, I think. It is indeed a big step forward, but it is at a relatively low volume across many of the sectors—sheep meat, for example. Not to belittle the potential for this agreement, but I think it’s the start of a very long journey with a very big country for a very small country.

I want to acknowledge the Minister and the officials for the work they did. There has been, through previous Governments—including Labour—a lot of work put in. I want to take this opportunity in the House to acknowledge Jane Cunliffe, who had worked in my office, who had worked with the Minister previously, who has just left, and who had been a trade commissioner in India and been part of a team of people who lived in that country over many decades, building a positive relationship that allowed this trade agreement to move forward so quickly.

We were told of this agreement at the end of last year. We knew that there had been work going on and that the Government and the Ministers had put in a lot of effort, but it was at the very late stages of 2025 that the Labour Opposition was aware that this agreement had been signed. But, actually, before the end of the year, of course, we also found out that it wasn’t a done deal, because the coalition partner New Zealand First indicated it wasn’t going to support the deal.

There had been, at that point—of course, over the Christmas period—a lot of questions focused our way—is Labour going to support this? Unfortunately, the Government had chosen not to include the Opposition at any stage through the negotiation of this agreement, so we had to then set about investigating what was in the detail of the agreement, and the devil is often in the detail. And we had a coalition partner, led by the Rt Hon Winston Peters, saying that this was a terrible agreement and that he wasn’t going to commit to it and that was it. Then we had the ACT Party and the National Party—and I know the Minister and a lot of his colleagues have done a lot of work, including the Prime Minister, visiting India—saying this was the greatest thing since sliced bread. We only got a copy of the agreement at the end of January, and we committed to the Government, in confidence, to go through that agreement as best we could. We asked for background information. It was a little like getting blood from a stone to get some of that information, which made us a little wary of whether the deal was a good one or not. The headline issues were, raised by the Rt Hon Winston Peters, that we were going to be flooded by migrants and that we were going to have to commit $33 billion in investment from New Zealand, and the Government had guaranteed it. Well, those were the claims.

Look, we went through that agreement very, very carefully, as I say, in good faith with the Government, checking that in what had been a political commitment to this from Christopher Luxon to get this deal over the line—very ambitious, I’ll say that—we hadn’t cut corners or in fact, given too much away in what is always a very, very challenging situation. Negotiating trade agreements is not easy. We’re talking about the sovereign rights of one country, the sovereign rights of another, and reaching compromise, ultimately, to get a good deal for both, not the best or a perfect deal for either side but a compromise that satisfies the interests or the vast majority of interests in both countries, to move forward and ultimately to be in a better position after one or two or five or ultimately 20 years. We came back to the Government in April, and we said, “On balance, in spite of not having all the information, we believe that it is a good step forward.”, and we agreed to support that. Indeed, a few days later, of course, that agreement was signed, and I was in India with the Minister, and he invited me over, and I appreciate and acknowledge that because it does have to be bipartisan arrangement. It has to be New Zealand, not just political parties, committing to agreements like this, because they do affect both our opportunities and some of our obligations into the future.

The select committee then went through, and I’d like to acknowledge the members of the committee for looking at the treaty, for the treaty assessment process that we did, for looking at the deal, and for listening to people coming in and making submissions. I think that was a very thorough process. Now, we have in the House, of course, a piece of legislation that the committee has looked through. It’s come back to the House, and as the Minister said, we just had a last-minute amendment that actually splits the bill. Now, we can understand the technical side of it and the justification for it. However, the committee didn’t have an opportunity to just check whether splitting the bill would make any difference to the outcomes or the opportunities from this. None the less, we’ll take the Minister’s word there, and I’m sure there will be some scrutiny in the committee stages in the House here to ensure that splitting the bill does not move from what we heard in select committee and what the select committee understands will be the final outcome of the bill.

Indeed, the outcomes are opportunities. They are not huge steps forward in benefits for New Zealand. The tariffs are lowered, and the quotas are put in place and, over time, may be reduced, but it is ultimately up to the exporters to take up the opportunities offered by this agreement. They are reasonable, and they are significant, but it will take some time to run through that.

If I can just point to a couple of things, as I say, Labour has always supported moving forward with trade agreements for our country. We are a trading nation. We are totally dependent upon that, and the things that we have to trade off are few and far between. We’ve always been open. We have very few tariffs. In the areas of investment, which is one of the areas where we’ve always got to put on the table, we have normally moved up to $100 million of investment into our country with very little scrutiny. The threshold has been moved to $200 million where people can almost, as of right, with some exceptions, be able to invest in our economy. It’s normally positive, but not always, so we’ve got to keep an eye on that.

This agreement allows investment from India into our economy of up to $200 million, and with not much scrutiny. What is concerning, of course, and the Government has yet to answer this, is the commitment to promote investment from New Zealand into India of $33 billion within 15 years. That is an ambitious target. That is an ambitious target and the Minister for wool over there would probably rather turn his back on, actually, the most significant market for wool in India, and insult the Indians by saying, “Well, we shouldn’t try.”

The scrutiny that we passed over this piece of the bill and its detail was that it is to promote the investment into India, not the final figure itself. Now, Prime Minister Modi came here and he said it was certainly high on his agenda. He certainly wants to see investment in India, and we have to be mindful of that expectation. Governments over the next 15 years will have to keep an eye on the level of investment. I’ve spoken to some of the sectors; not a great deal of enthusiasm at the moment, but this is a market of 1.4 billion people and, indeed, we will have to have a commitment from exporters to invest in that market if they want to maintain the benefits negotiated in this agreement. It is nonetheless a risk, and we in Opposition have tabled that risk, which is why I go back to one of the most significant trade agreements. I’m not quite sure that I agree with the Minister for Trade and Investment on that, but it is certainly, potentially, significant.

On the issues of immigration—another thing raised by New Zealand First—the Labour Party has scrutinised this very, very carefully. It does offer opportunities for Indians to come into our country, but they are limited in number and limited in the associated benefits with that Temporary Employment Entry particular assigned—I don’t know what you call it. Anyway, it is a particular pathway for migrants that is unique to this agreement, and, indeed, the terms have been written into this agreement. We feel assured that, actually, that does protect us from rampant migration, and no doubt we’ll hear some counter views from New Zealand First.

The third area is innovation, and it will be through partnerships and innovation that we build our strongest partnerships with India. That was indeed the topic of many conversations that I had as trade Minister, and that my colleagues in Government had as Ministers when they visited India. This does offer huge opportunities into the future. The Labour Party supports this legislation through, but there are some risks that we have to acknowledge, and those risks go with the opportunities. Ultimately, it’s up to the exporters as to whether they take those up.

Thank you, Mr Speaker. I rise on behalf of the Green Party of Aotearoa New Zealand to speak on the India Free Trade Agreement Legislation Amendment Bill. Now, the Green Party has opposed the agreement in the past, so it makes sense the Green Party will not be supporting the India Free Trade Agreement Legislation Amendment Bill.

Now, there are a couple of things, and I think both the Minister for Trade and Investment and also the Hon Damien O’Connor have mentioned the agreement that kind of underpins this particular bill, so it’s important for us to sort of address some of these areas as well. I think one of the fundamental challenges, and particularly for the Greens, when we’re looking at any sort of trade agreement is, firstly, we do have a level of scepticism when it comes to bilateral trade agreements in general. We have seen that bilateral trade agreements have been used more and more often now because of the challenges that the World Trade Organization is facing, despite the fact that, yes, it can still be said that most of the trade agreements internationally are still multilateral, or even plurilateral in some instances. Using the New Zealand - India free-trade agreement as an example, we do see India, that is traditionally hesitant when it comes to bilateral trade agreements, increasingly signing bilateral trade agreements, or at the same time, trying to uphold this international rules-based trade system as well, making deals with Aotearoa New Zealand, making deals with Australia, with the EU, and the like.

We’re seeing that even countries that are shying away, traditionally, from bilateral trade agreements are making some of these agreements. But fundamentally, one of the things that is still a continuous concern for the Greens is that the over-use of bilateral trade agreements, although works to a certain extent, does undermine the way that we look at that international rules-based trade system in general, because bear in mind that there are countries, India being a good example, that may not have the ability to negotiate strongly; or other countries that we see who are blatantly violating some of that international rules-based system, whether it is the increase in tariffs in the US or protectionism in other countries when it comes to resources.

When we’re looking at Part 1 to 4 of this bill, there are also other areas that are of concern as to how they have manifested through the agreement itself. Now, we have heard that we still haven’t received clarity around what that US$20 billion of intention to promote really means for our people and for our businesses here in Aotearoa New Zealand. That’s $33 billion over 15 years. Yes, we can say that it’s the intention to invest and all of those, but the problem is that the country that does make that kind of decision falls with India as opposed to their being part of a joint discussion. I think that continuously is a concern, like the Hon Damien O’Connor has said, that this is going to take future Governments, regardless of who is in power, nuance and a level of balance and also diplomacy to be able to get some of that right and to be able to work through what that potentially means. Also, fundamentally, it seems wild that we’re also expecting that the Government in some ways is having this level of commitment and requiring our businesses to be able to do that.

Now, of course, there are other levels of commitment in here, whether it is the impact this will have on our tariffs being a key thing. Because bear in mind, even though you look at Part 1, which talks about dairy tariffs and also, particularly, around things like albumin, which is a big part of this particular agreement—and my colleague Steve Abel will be speaking more around agriculture and dairy in general—but that is also a concern because, again, a lot of the tariffs of imports coming from India will be removed from day one, but a lot of the tariffs that we see for our export sector going into India will only decrease over time. If India, in this case, does find that we are violating some of the terms and conditions, particularly around the intention to invest, they’re able to remove some of the tariff reductions that we are supposed to be enjoying even as a part of this bill. That is something that is also a concern for us to think about. Of course, even when it comes to bilateral agreements, from a Green perspective, environmental protection and climate action and labour rights absolutely underpin what we consider to be a good bilateral agreement, which is why, out of a lot of the bilateral agreements we’re currently seeing, the New Zealand - EU free-trade agreement is the only one that we have supported thus far.

But there have been a lot of conversations. I’m noting that the bill that we do have, and we have lots of questions for the Minister during the committee stage as well, is a manifestation of that particular agreement, so the ability for us to even look at some of these things that we could change is quite limited, even though some of the changes we have seen during the select committee stage deviate from what we have seen in other comparable free-trade agreement bills or Acts in the past, or even comparable acts that are related to this, and I’ll mention a couple of examples. But through the committee of the whole House stage, I think one of the first things—you know, whether we’re looking at tariffs or we’re looking at other forms, the quota and how we look at quota managers, and the management of those quota continues to be a big focus in this piece of legislation.

One of the things I think is really interesting that we’ll kind of explore more fully during the consideration of this bill, as opposed to the consideration of the agreement, is what’s the genus, when we’re looking at—because, you know, as part of the agreement we’ve had the Apple Action Plan, the Kiwifruit Action Plan, the mānuka action plan. I would be keen to know, particularly when we’re looking at Part 4 of this bill—and we did have a little discussion during the select committee stage around what is captured by “kiwifruit” in the Kiwifruit Action Plan; noting some of the ongoing concerns we have with the loss of some of the cheaper varieties in China, as a result of some of those particular stocks being leaked is probably the best word that comes to mind immediately, but I’m sure there are other more appropriate words for that. For us, it’s really important to be able to prevent—

💬 Hon Member: Stolen.

“Stolen” is possibly a strong word. I guess it depends whether it was passed on, whether it was stolen by someone else. I think, you know, if we were looking at it from the context of criminal law—maybe we need to have a bigger discussion in the committee stage around mens rea and actus reus. I’m happy to have that conversation.

But it is interesting to see, in this agreement in particular, that mānuka honey—specifically mānuka—is locked in. I’ll be keen to know what that, potentially, means for other bilateral trade agreements, particularly when it comes to the Australia - India free-trade agreements.

Just finally, a couple of other things that we had considered during the select committee stage—it’s around search and surveillance, but particularly around investigation. I think this is something that we still do need to tease out. I know that this is something that my colleague Vanushi Walters and I did have a fair bit of conversation and discussion about as a part of the consideration of this bill—and also in terms of some of the aspects when it comes to secondary legislation about fee setting. I think it’s also important for us to consider this further during the committee of the whole House stage with the Minister for Trade and Investment.

One of the things I would like to point out, finally, and this is more of a broader concern that we do have—one of the things that the Green Party is is disappointed. This is, from a process perspective—like the Minister said, like the Hon Damien O’Connor said—an important treaty examination. But at the same time, the Government could not even adhere to its own Cabinet Manual, of refraining from taking any binding treaty action, in respect of a treaty that has been presented to the House, for 15 sitting days, but expected a select committee to move up the schedule for deliberation within that 15 sitting days. I believe we only had about nine sitting days to consider the agreement itself before the first reading of this bill was introduced. That simply is not good enough because when we saw the Trans-Pacific Partnership agreement, the Foreign Affairs, Defence and Trade Committee and the Government actually extended the time for consideration because it was important.

But again, it just highlights that this bill—we’re yet to see if this will genuinely be beneficial for the people of Aotearoa New Zealand, or if it is something that’s simply for political gain. So the Greens will not support it at this stage.

Thank you, Mr Speaker. I rise on the second reading in support of the Indian Free Trade Agreement (FTA). Firstly, I just want to thank my other committee members for the work that we have done in scrutinising this legislation. This is the enabling legislation, but, as many members before me have started to speak quite a bit about the agreement itself, I will note that ACT did have some concerns, but we felt that they were well-traversed throughout the committee of the whole House stage, and we’ve landed in a relatively good position here.

The bill that is coming in to help with the legislation and getting it in place is really about setting out the framework, the quota management system, how it will work, and also around amending the Overseas Investment Act, for example. So that is really small technical stuff.

There has been heaps of commentary on the Indian FTA and I will agree that I think it is a really small step in the right direction. There was certainly not enough credit given to the likes of dairy, for example. Some of the quota amounts are quite small in some areas, and I think that we could have been far more ambitious. But you have to start somewhere. I think the Minister outlined, very succinctly, that India has the fastest growing middle class globally. New Zealand is not in a benign position; we are a tiny island nation at the bottom of the planet. We need to make sure that we are diversifying our trade options. For that reason, I’m going to commend this bill to the House.

I rise on behalf of New Zealand First to oppose this bill, the Indian free-trade agreement (FTA) bill, especially in the form that it is in.

💬 Hon Damien O'Connor: What about the wool!

The wool is a product we’re selling. If you listen long enough, you’ll learn the difference.

New Zealand First has, in its manifesto—

ASSISTANT SPEAKER (Greg O'Connor): I’ve lived long enough, thank you, Mr Wilson.

—the aspiration to sign a FTA agreement with India, just not this version.

An FTA should deliver mutual benefits; this one advantages India over New Zealand. We need to get it right. Foreign affairs Minister, the Rt Hon Winston Peters, has visited India on many occasions to further New Zealand’s interests and facilitate a mutually beneficial agreement.

New Zealand First supports expanding New Zealand’s access to major global markets. As an export-driven nation, our prosperity depends on selling goods and services to the world and India, home to around 1.4 million people, represents a significant market. However, FTAs take time and should not be done in record time, as we heard earlier. With due care when negotiating an agreement and drafting legislation, we enter a legal arrangement that commits both parties under the World Trade Organization General Agreement on Trade in Services and General Agreement on Tariffs and Trades, and, on the other hand, our own domestic legislation.

The current Indian FTA bill has been too rushed and falls short in several areas and therefore should not proceed in its current form. The national interest test highlighted some concerning loose ends which, combined with various hooks in the agreement itself, does not put New Zealand on the same level as India in this agreement. New Zealand First would like to see some of these issues resolved. The trade imbalance: New Zealand is opening its market more fully and immediately than India, particularly in dairy and horticulture, while India retains significant protections, concessions, and exclusions. New Zealand has fully liberalised all tariffs on Indian imports from day one under this agreement, from a very low 2.2 percent tariff base, whereas India has 30 percent of its tariff lines remaining at high rates up to 33 percent with very gradual reductions.

The Indian economy sits around $4.1 trillion with a rising middle class compared to approximately US$240 billion for New Zealand. Our export impact on India’s economy is tiny, limited, and exclusionary. India’s potential impact on New Zealand’s economy, on the other hand, is vast and open. Why on earth—why on earth, then, are we investing New Zealand dollars—$32 billion—in their economy with no reciprocal agreement?

💬 Immigration: this agreement goes beyond trade by embedding migration commitments that could limit future New Zealand Governments—aka us—control over immigration settings. It’s going to be in the agreement. There are uncapped and open-ended migration pathways that will impact New Zealand and New Zealanders. For example, uncapped student visas with 25 hours per week paid work allowable with a two-year post-study extension work visa, and after that, even, you can have a further extension if you wish.

The words that you were looking for, the Hon Damien O’Connor, were the uncapped intra-corporate transfer work programme—nice words—for work specialists, like yoga teachers—we need more yoga teachers, apparently! This allows for up to three years’ employment and access for partners and children who can also seek student or work visas whilst here, three-year work visas—take one of those—with an accredited employer. Oh, and a further work visa for another five years—post-study and post-work visas that can lead to residency applications with familial skilled migrant business and investment specialist work access. It goes on, and it goes on. New Zealand First has concerns about these things and argues that it will increase pressure on housing, infrastructure, services, job security, and social cohesion at a time when our youth and unemployed need jobs.

💬 Investment: New Zealand First objects to the proposed commitment to facilitate US $20 billion of outward investment into India over 15 years, especially because India may be able to rebalance some of these concessions, the Hon Damien O’Connor, on tariffs, intellectual property, and quotas if it considered that New Zealand had not met its cooperation agreements. The commitments under these cooperation agreements are not benign.

Agricultural cooperation and quotas: New Zealand First is concerned that cooperation mechanisms and agreed action plans could compel New Zealand to share valuable agricultural expertise, cultivars, tacit knowledge, and intellectual property while exposing New Zealand to penalties if these commitments are not met.

Intellectual property (IP): a major risk in this agreement is that New Zealand plant varieties, seeds, technology, trade secrets, and industry know-how could be transferred or weakened under India’s IP framework, especially given India’s non-membership of the International Union for the protection of New Varieties of Plants. Come on, guys. We’re giving our stuff away; we’re selling our knowledge. Have we not learnt? Intellectual property within industry sectors is more than a legal definition of one innovation, strain, strand, or cultivar. IP, trade secrets, technology transfer, and sharing of expertise are evident in this FTA under those agreed action plans. Figure it out. New Zealand needs to be sure that there is no such repeat of, for example, SunGold Gold3 kiwifruit, mānuka honey in Australia, Envy apples in China, and the list goes on. We have not protected our stuff, and here we are doing it again. This is kind of crazy.

Domestic Indian legislation—have we really looked at this?—provides scant evidence for the protection of New Zealand’s IP and shared expertise—scant evidence. Why are we selling our trade secrets when we could be taking advantage of years and years of science, producer practices, and tacit knowledge and when we could be protecting our strongest competitive export advantages instead of giving them away?

Rules of origin and manufacturing: we haven’t come across that yet. Let me say what New Zealand First warns about—the specialist high-value dairy ingredients. We will be vulnerable to the rules of origin abuses by providing the opportunity for intermediary countries to exploit preferential trade agreements. The few concessions in the India free-trade agreement include tariff concessions on specialist dairy ingredients, such as albumins and peptones to be re-exported from India—in other words, New Zealand’s only dairy access—to support India’s manufacturing and value-added products. Why are we giving that expertise away?

💬 Hon Mark Patterson: This is a terrible deal.

We’re getting there. How about the financial systems you’ve signed up to? Did you know about those? Come on. Those on the Finance and Expenditure Committee might know a little bit about this. There is concern in this agreement about the cooperation on digital payments, unified payments interface integration, fintechs, central bank digital currencies—CBDCs, right?—data governance, scams, privacy, and financial sovereignty. New Zealand First does not see how these clauses are fundamental to this agreement, given New Zealand itself is still concerned about, and still considering, all of these things. We’re not there yet with CBDCs. Come on. We’re signing a free-trade agreement, thinking that that’s going to solve it for us. Are you crazy?

The United Nations Declaration on the Rights of Indigenous Peoples and the Paris Agreement: these commitments should not be included in the trade agreement, because they could turn domestic policy choices into FTA obligations. We’re signing up to it with them; we have to live up to it. New Zealand First believes this free-trade agreement is not a good deal for New Zealand and New Zealanders. It is not too late to turn this into a free-trade agreement that benefits New Zealand and is in agreement on trade. Thank you, Mr Speaker.

ASSISTANT SPEAKER (Greg O'Connor): Steve Abel—five minutes.

Thank you very much, Mr Speaker. We believe that trade, globally, should be focused on fairness, not simply on the removal of barriers to corporate exploitation of people. This bill has some real problems with it—this free-trade deal—and I want to outline some of the ones that the Green Party is concerned about. One common thing that we try and get better trade on, with other nations, is our dairy products. I think it was inappropriate for us to seek to flood or impact the local Indian dairy industry and market with New Zealand dairy products, because why would we as a nation that is, as is commonly expounded in this House, so dedicated to the dairy industry want to undermine the most ancient subsistence dairy culture in the world?

Cows have been farmed in India for 8,000 years. Do you know how many dairy farmers there are in India? About 80 million dairy farmers. Most of those dairy farmers own between two and three cows. Some only own one cow. Many of them are landless. They are subsistence farmers. They provide nutrition to their households and some small income from the dairy that they produce. I don’t believe it was ethical or appropriate for us to ever seek to undermine dairy farmers in India with our dairy product, here, from New Zealand.

💬 Hon Andrew Hoggard: So if we all have one cow, then you’ll stop attacking the dairy industry in New Zealand?

What did he say? I missed it. You’ll have to tell me that later, Mr Hoggard.

There’s another very glaring problem with this bill that has been outlined by our colleagues from New Zealand First. No, we’re not going to make a xenophobic attack on it, because we don’t believe in a race-baiting nationalism, which is the last refuge of the scoundrel; we believe in criticising it on economic grounds. It is the obligation that we shall promote foreign direct investment from New Zealand with the aim to increase foreign direct investment inflows to the value of United States $20 billion. That has been said before by my colleague Lawrence Xu-Nan—that’s $33 to $34 billion New Zealand dollars at current exchange rates. That has to be achieved within 15 years. Now, for context, there is nigh on zero possibility that we can achieve that, because New Zealand’s total foreign direct investment (FDI) outflow—abroad to all countries in the entire world—in 2025 was $1.46 billion. Just think about that figure. Less than $1.5 billion dollars is how much FDI New Zealand invested in every other country in the world, and we are signing up to an agreement whereby, in the next 15 years, we’re going to achieve a $34 billion investment in just one country. Where in the Lord’s name is that going to come from?

Foreign direct investment requires us to find the monies to invest in another country—i.e., not invest in our own country—and exporting such massive volumes of capital would be flying in the face of our current balance of payment position. We run a chronic current account deficit, and it’s largely driven by the outflow of profits to foreign investment in New Zealand—i.e., to Australian banks and to Australian companies that now own our meat industry in part. Additional financial outflows of direct investment to India would require either additional exports, fewer imports, or higher overseas debt to compensate. The New Zealand dollar would fall in value, making imports more expensive and overseas debt more expensive to service. This, in the name of doing good for our economy, is actually a total nightmare for our economy over the next 15 years, and that particular part of this agreement will come back to bite future Governments very hard.

Thank you, Mr Speaker. Look, we’ve traversed well the fine benefits of this free-trade agreement (FTA), and so I’ll focus my comments on the changes made through the select committee process. I do want to start by thanking submitters for their contributions through that process, and also fellow members of the Foreign Affairs, Defence and Trade Committee and the advisers. We did consider this in a very efficient time frame, and the aim of that was to make sure that we could get ahead of the EU FTA with India in order to enjoy that most favoured nation status with regard to wine, in particular.

Our focus was really around the nuts and bolts. We ensured that the Ministry for Primary Industries were considered accountable at the same level as other non-Crown quota managers. We put in a deadline to have a reasonable time frame for appeal processes around quota allocation. We got rid of the need to gazette those so that there’s less red tape, and we had some broader consultation on fee-setting, as well. Then, with regard to the search powers piece, we didn’t think it was appropriate to give warrantless search powers in this instance.

Those were a quick summary of the key changes we’ve made. This is a good piece of legislation, and I look forward to it progressing. Thank you.

Thank you, Mr Speaker. Like my colleague the Hon Damien O’Connor, I rise to speak in favour of the India Free Trade Agreement Legislation Amendment Bill at this second reading and to commend the Minister for Trade and Investment for seeing the agreement through, but, as my colleague has said, really, the foundations of building the relationship happened before this term. I will speak in more detail to that at the third reading of the bill, but I did want to mention that in 2020, there was a five-year plan that the Labour Government put into place in terms of developing that relationship. Both the Hon Damien O’Connor and the Hon Nanaia Mahuta were very much responsible for driving forward that platform, on which this agreement proceeded.

As the Hon Damien O’Connor has said, this isn’t necessarily the agreement that we would have negotiated, but it is a start and it does present an opportunity for New Zealand, both for our larger exporters and also for our small and medium sized enterprises, as well. We heard from a number of submitters, including Business New Zealand, ExportNZ, Zespri, Seafood New Zealand, Beef + Lamb New Zealand, and others, about just how much they expect it to benefit their business in the coming decade-plus. As has been mentioned, export is directly connected to one out of four jobs in New Zealand, and so it certainly is a benefit, despite what others in the House have said.

Now, of course, this is an interesting piece of legislation because we first had the treaty examination process and received submissions on that. Can I commend the chair of the Foreign Affairs, Defence and Trade Committee, Tim van de Molen, for his work both on that part of the hearing as well as on this part, which was much more specific about a much thinner range of issues, but the submitters who made submissions in relation to this bill, regardless, submitted on the agreement itself in quite a broad way, and so I did want to speak to some of the issues that others have traversed, as well.

The first one is the investment commitment. As has been said, this isn’t a commitment in regard to the amount itself—so the $33 billion—but it is a commitment to promote. It is an effort clause in terms of how I like to see it, and it is one that we are obliged to work towards over the course of 15 years. But others in the House have used the word “clawback”, almost suggesting that once we get to 15 years, if India is not satisfied that that effort clause has been met, they can somehow retrospectively claw back some of the benefits to our exporters that they have already accrued, and that’s simply not the case. So, just to be clear on that, that is a clause that kicks in in 15 years’ time and, in the meantime, all those benefits are available to our exporters, and certainly I would expect the relationship to develop as such.

The second issue is the treatment of workers, which is always very central to our thinking as a Labour caucus. During the course of discussions and of reviewing the documents, that was a very significant part of what we took forward as a condition of our support. This conditionality is in two parts: one is to ensure that the labour inspectorate has sufficient capacity to be able to manage issues as they might come up, and the second was in relation to ensuring that the people impacted have access to legal advice at the very earliest of stages, and our proposal was that that could be done through Community Law. So we will absolutely be continuing to look at this to ensure that the Government is putting in place those measures.

Now, my Green Party colleague Steve Abel spoke about fairness and the issue of flooding the Indian market. In my view, that isn’t an issue in this scenario. He spoke about dairy, and that’s of course not going to be an issue in relation to the agreement as it is, but in terms of the other exported goods at play, there are clauses in the agreement which allow either party, due to a flooding-of-the-market issue, to suspend a quota amount because it’s having a direct impact on their local market, and so that isn’t an issue at all.

Then we had colleagues from New Zealand First speak about the immigration issues here. The immigration commitments are narrow. They’re not novel; they’re not something very new that we’re placing in our agreement with our Indian colleagues.

The commitments are largely consistent with or below the existing standards that we offer more generally. With the student visa work rights, for example, Indian student visa holders would get at least 20 hours of work rights per week, but the current settings are 25 hours, and so, in practice, the new commitment doesn’t expand on the status quo at all.

In terms of the uncapped flood of student visas that we’ve heard about from some members in this House, the no-cap commitment simply locks in a New Zealand approach more generally. It doesn’t create a new approach at all. The post-study work extension is narrowly targeted to PhD graduates. It’s not the general student population, and so it really does limit that cohort of entry, and, of course, the Government still retains policy levers to be able to control and manage the flow of immigration.

I just did want to say that I think it’s extremely irresponsible, some of the rhetoric that we’ve heard around immigration not only today but earlier in the House. I do think that members who continue down that path ought to take into account that it’s having broader ramifications in the public—what’s just being said in the House here.

The chair of the select committee has spoken to some of the changes that we made as a select committee in the House, and I just did want to acknowledge that some submitters—including, I believe, it was ExportNZ—urged us not to make any changes to the legislation so that it could proceed at pace. While I completely do understand that perspective, my view is that the changes that have been made are very technical but also extremely practical in terms of where we’ve landed. For example, the quota system that was created, essentially, at the initial drafting of the bill envisaged that the legislation would be passed at the start of a quota year, which isn’t necessarily the case. There are tweaks that we made to that which would help it make sense and would allow those quotas to be seen as a proportion, rather than applying from the get-go.

The other change that we made—which is a fascinating one—was in relation to search and seizure powers. As members have referenced, we removed one of two of the search power options. One was a warranted search, and the second was an unwarranted search to, essentially, allow inspection where there weren’t any grounds to secure a warrant in the first place. The committee’s decision was to completely exclude warrantless searches.

Now, interestingly, this is a point at which the committee disagreed with the legal advice that was provided by Crown Law. Crown Law’s view, on examining the initial search powers, was that both the warranted search powers and the non-warranted search powers were compliant with the New Zealand Bill of Rights Act and were lawful in that respect, and they counted as a reasonable search or seizure, but it was certainly the committee’s view that those unwarranted powers, with no suspicion whatsoever, were not. I do think that that’s a fair place for the committee to land.

My one concern in terms of where the committee has landed in regards to this free-trade agreement (FTA) is a question of whether the powers of search are consistent in relation to other powers that apply in the other FTAs—specifically in regards to the powers of inspection relating to dairy. The powers that relate to dairy reference Part 4 of the Search and Surveillance Act, which, in my view, were framed up as a power that is responsive to criminal offending. I do hope that in the long term, this House can look at whether we need a new search powers regime that is more fit for purpose for civil regimes and to allow the current search powers to only apply to criminal regimes. Having said that, I do think the committee did a fantastic job of scrutiny, and I commend the bill to the House.

It’s nice to see Lawrence Xu-Nan and Winston Peters agreeing on something, but I fear they’re on the wrong side of this one. In New Zealand, if we want more options for Kiwis, if we want more teachers or nurses or doctors—whatever we want, it takes money. New Zealand has always made its money by selling stuff to the world. India opens up 1.4 billion customers to New Zealanders. It is a great thing. I commend it to the House.

ASSISTANT SPEAKER (Greg O'Connor): This is a five-minute split call.

Thank you, Mr Speaker. It’s a pleasure to be able to contribute to this second reading of one of two bills that are implementing the India free-trade agreement (FTA).

Why does Labour support this FTA? For a number of reasons, and I’ll run through them. As the previous speaker, Tim Costley, was saying, this trade agreement really is a bridge to one of the fastest growing and largest economies in the world. There’s no doubt that in the years to come, India’s economic growth will make it one of probably three of the major great powers in the world, and over time it will probably surpass China in terms of the size of its economy. For New Zealand, I think the case is that—and for me this is what it all comes down to—in this increasingly uncertain world, it’s very important that New Zealand has the opportunity to deepen and build its bilateral relationship with India, given India’s geopolitical and economic significance.

The agreement itself is far from perfect, and I’m sure Damien O’Connor would have negotiated a much better one. No—didn’t get a rise of the Minister for Trade and Investment on that one. It’s not the agreement that Labour would have negotiated, but we have, after long and careful deliberation, taken the view that this agreement is in New Zealand’s national interest. There are very significant tariff reduction benefits to some of our most important primary sectors—kiwifruit, wine, honey, sheep meat, and forestry, among others. The opportunity to open up significant export relationships in services, tourism, and labour mobility is clearly, in our view, in our national interest.

I want to say something about the immigration aspects of the agreement. This agreement does not open the floodgates. In fact, it’s quite moderate. Labour mobility is extremely important to the Indian Government. Labour mobility provisions already exist in a number of the big trade agreements that have been negotiated internationally in recent years, including in several of ours. It’s not something to be afraid of, and the provisions in this agreement—specifically the 1,600 a year temporary work visas over three years; 5,000 at any one time; no pathway to residence; no right to bring family here—are commitments that will fit quite snugly within New Zealand’s existing immigration policy settings. Labour mobility was extremely important to the Indian Government, and I doubt we would have had this agreement if we hadn’t been willing to negotiate on those aspects.

I want to say something to colleagues in the Green Party about their approach to this in relation to ours. As I said, we acknowledge the bill’s not perfect, but Labour has always understood that New Zealand’s destiny and prosperity are very tightly tied to the ability of our firms to export and sell their goods and services on international markets. Without that, we wouldn’t survive. Agreements like this, and the China trade agreement before it, I think, are a pretty powerful illustration. Nevertheless, we also recognise that trade relations produce winners and losers, and it’s very important that at the national level, the distribution of benefits and costs are taken into account by Governments—our Governments—and we use the levers available to ensure that we recognise and address those.

We’re also committed to the Trade for All agenda, developed when David Parker was Minister for Trade and Export Growth, and a determined effort to take the community along with us. These processes should be transparent; we should engage the community and different interest groups and stakeholders—and particularly the very often sensitive labour and environmental standards that really go to the heart of the winners and losers in these agreements need to be considered and, wherever possible, negotiated in substance into these agreements.

I am really excited to support the India free-trade agreement. Coming from Hawke’s Bay, the fruit bowl of New Zealand, this opens up huge potential for our apples, cherries, kiwifruit, red meat, wool, wine, forestry—the list goes on. It’s going to be huge for our economy, huge for jobs and opportunities, so I commend this bill to the House.

It is a pleasure for me as a New Zealand member of Parliament of Indian origin to stand and take a call supporting the India Free Trade Agreement Legislation Amendment Bill. I think for the entirety of my almost nine years in this House, this is something that Kiwi-Indian communities have been talking about and have been wanting to see Governments progress.

I, too, want to acknowledge the work of the previous Labour Government—particularly Nanaia Mahuta, David Parker, and Damien O’Connor—who had, as my colleague Vanushi Walters pointed out, a five-year plan to ensure that we stepped up the relationship between the two countries. There was a fair bit of effort that was put into that and a number of visits both ways that were symbolic, I guess, but also bore testament to the fact that that relationship was being strengthened and deepened. I do want to point to that and the fact that this is many, many years in the making.

It was a really good opportunity for me to be the only Opposition member as part of the PM’s delegation to India when the announcement was made around the negotiations restarting on this free-trade agreement (FTA). It allowed me to see the difference in narratives between how the FTA negotiations were being portrayed in India through the media and various industry organisations in India versus the narrative that was being shared by the current Government rampantly within Kiwi-Indian communities here. They were very different. What we heard here was that the Prime Minister had made a commitment on the campaign trail that if National was elected, there would be an NZ-India FTA negotiated and concluded in the first term, and all of that. And then the story that was sold was the power of this Government’s negotiation powers, I guess, or the strength of this Government’s negotiation powers, and how, in one year, they had done what no Government before them had managed to do, and they had deepened that relationship and got to a point of negotiating, or reopening negotiations, on this free-trade agreement. And yet, everything that we heard over in India—the way the story was being told back in India—was that things had changed. Geopolitical shifts were happening and India needed to secure supply chains; India needed to diversify their trade. It was very clear that India’s exports had been negatively impacted by the 25 percent tariff that the US had slapped on them, and so they needed to open up.

And so, in the last two years, India has been actively negotiating 10 free-trade agreements. Things have changed quite dramatically on the Indian Government side. And there’s no doubt that that was to our benefit, but it wasn’t due to the strength of this Government’s negotiation powers alone. I want to put that on the record, because that is the story that is being sold.

However, as colleagues on this side of the House have made very clear, this is not the gold star of free-trade agreements (FTAs) either. It’s not perfect, but we support it on this side because it goes some way towards improving things for us and for New Zealand exporters. We know that it gives New Zealand exporters more options in an uncertain international environment; that it positions New Zealand to benefit from India’s long-term economic transformation. We know that about 95 percent of New Zealand’s current exports will gain when it comes to tariff eliminations or substantial tariff reductions, particularly in sheep meat, in forestry, in kiwifruit, in apples, and wine. We also know, from significant commentary, that the gains may not be immediately realised, but the greatest value is likely to emerge over time. It gives New Zealand businesses a platform to develop new products, strengthens commercial relationships with India, and helps to build a sustained presence in a market of 1.4 billion people. All of that goes a significant way to benefiting New Zealand.

I understand that the Government has commissioned modelling that estimates that the FTA could lift New Zealand’s annual GDP by about $380 million, and exports to India by about $836 million by 2036. And so, for all these reasons, Labour supports this agreement and the legislation that will go towards enabling that. However, as we have pointed out, there are risks and there are two that I want to touch upon. One that is a significant risk, that Labour has pointed out, has highlighted, is the investment clause that others have spoken to, as well. It is a large sum of money that is meant to be invested in India. And as Vanushi Walters has pointed out—it’s US$20 billion, about NZ$33 billion in investment—it’s an investment promotion commitment. We need to show that we have done the work, put in the effort, over a 15-year period, for that investment to happen. But compare that with the 15-year period after the China - New Zealand FTA was signed, where outward investment to China was to the tune of about $1.5 to $1.8 billion over 15 years. So this US$20 billion commitment is significant, and the Government does need to reconcile Minister McClay’s aspirational, sort of, characterisation of this investment clause with what we’ve heard from the Indian Minister’s description of potential clawback measures, as well. The Government needs to be quite careful about that.

The other risk that the Government needs to provide some certainty around, or to correct the public record on, is whether future Governments can still manage international student numbers. We saw what happened under the John Key National-led Government, where there was a monetary target put on export education, which then led to a proliferation of private training establishments (PTEs). Of course, some PTEs have a legitimate role to play in our education sector, but the proliferation of PTEs that were providing substandard education—where many from India had sold land and houses to get the money to send their children to New Zealand, to get the substandard qualification, that then didn’t get them a job in New Zealand, and led to an increase in migrant worker exploitation. We saw that happen under the last National Government, and we want to make sure that there are protections—that we don’t stray into that territory. It’s bad for us and New Zealand’s reputation, but it’s also bad for the migrants and the students who come to New Zealand to study and to work here.

On the note of migrant worker exploitation, I do want to point out some of the wins that Labour has secured. We said we would—the process that the Government undertook to embark upon these negotiations was flawed. You don’t chuck out your foreign Minister—well, the foreign Minister exited the chat—negotiating it. Where the Government themselves didn’t have the numbers to pass ratification legislation in this House—knew that, embarked upon, and waded into it anyway—then came to Labour in the eleventh hour to get our support. We have provided conditional support as long as the Government expands the labour inspectorate to fund at least 14 additional staff focused on migrant worker exploitation, faster visa changes, and progressing the modern slavery legislation that we did a huge amount of work on in the last Government. All of those are things that the Government has agreed to as part of our conditional support for this legislation, but it will need to deliver on it and not just provide lip service and agree in principle to all of that.

I want to end with the narrative around immigration. We know this is not open-slather immigration. My colleagues on this side of the House have been very clear as to why, but I want to point to how dangerous it is when parties like New Zealand First use this to talk about and, I guess, scaremonger and spread misinformation around the nature of immigration as a result of this bill. It is false. It is dangerous. It has harmed Kiwi-Indian communities and made all of us feel much less safe. That is not the society that we want to be in. And so when David Wilson stands up and talks about social cohesion in this House, it is laughable, because it is their party that has led to a huge amount of hate towards our communities as a result of their irresponsible narrative on this bill.

Thank you, Mr Speaker. I stand to support this bill. There are many important components, and I especially note the sectors on apples, kiwifruit, and honey. Ngāpuhi rangatira Sam Napia has affirmed to me that these are very important to the Māori economy. With that, I’m very pleased to commend this bill to the House.

A party vote was called for on the question, That the India Free Trade Agreement Legislation Amendment Bill be now read a second time.

Ayes 93

New Zealand National 48; New Zealand Labour 34; ACT New Zealand 11.

Noes 29

Green Party of Aotearoa New Zealand 15; New Zealand First 8; Te Pāti Māori 4; Ferris; Kapa-Kingi.

Motion agreed to.

Bill read a second time.

ASSISTANT SPEAKER (Greg O'Connor): The India Free Trade Agreement Legislation Amendment Bill is set down for committee stage immediately.

I declare the House in committee for consideration of the India Free Trade Agreement Legislation Amendment Bill.

Committee of the whole House

Part 1 Amendments to Dairy Industry Restructuring Act 2001, and Schedules 1AA and 1

CHAIRPERSON (Maureen Pugh): Members, the House is in committee on the India Free Trade Agreement Legislation Amendment Bill. We start with Part 1. This is the debate on clauses 3 to 13, “Amendments to Dairy Industry Restructuring Act 2001”, and Schedules 1AA and 1. The question is that Part 1 stand part.