India Free Trade Agreement Legislation Amendment Bill

Committee of the whole House

Mr Chairman, look, thank you very much. I’ve had a couple last night—interesting numbers in the House here over this piece of legislation. We are supporting it, but the title—the point was made last night, and it might seem somewhat frivolous, but it actually does go to the truth of this piece of legislation, which is amending the customs Act and amending the Dairy Industry Restructuring Act. The question of whether the Minister had thought about a different title for the bill—and then, of course, we have later on the splitting of the bill.

Effectively, this first bill is amendments to existing legislation, and the second is setting up the quota management system for all the areas of apples, of kiwifruit, of honey that we have negotiated through this agreement. So it’s two separate bills; the one of the title that is in part covering both bills, and I’m not quite sure what the Minister will call the second bill. Maybe he could explain whether the bill could have been renamed and more appropriately be named “Amendment to Customs and Excise and Amendment to Dairy Industry Restructuring Bill”.

CHAIRPERSON (Teanau Tuiono): Steve Abel—wakey wakey, folks.

Committee of the whole House

I thought my colleagues from New Zealand First might take a call on this one. I think the most notable factor of this bill, which has been somewhat touched on but for which we’ve had no satisfactory response from the Minister, frankly, is that in weighing up the India Free Trade Agreement Legislation Amendment Bill, one has to determine whether what New Zealand gets from the bill is greater than what we potentially lose through the deal. The most glaring component of that is the $35 billion price tag over 15 years for whatever we’re supposed to get from this free-trade agreement.

I want to note that in the Ministry of Foreign Affairs and Trade estimates of what New Zealand will gain by 2037—after 10 years of this free-trade agreement being in force—is an expectation that the tariff cuts that will have come into force by then will be just 0.7 percent of our GDP, or $401 million relative to the non - free trade agreement baseline. In 15 years’ time, we will have had to invest in India $35 billion. Anyone who does maths on those numbers—$401 million versus $35 billion—has got to be asking, “What are we signing up to here?”.

My proposal for the India Free Trade Agreement Legislation Amendment Bill is a new title that I’m happy to make up on the spot. I’m going to call it the “India Free Ride Agreement Legislation Amendment Bill”, because when our negotiators sat down at the table to say, “We want access to your markets, we want you to lift your tariffs.”—India to lift its tariffs—India said back to New Zealand, no doubt, “Well, what do we get in terms of what you’re going to make way for?”. New Zealand has already got rid of nearly all of its tariffs. We forfeited them under an ideological view of neoliberalism. We long ago gave up tariff barriers to trade. Nigh on no products into our country have tariffs, and they’re mostly under 5 percent. So what did New Zealand have to offer?

India rightly, and sensibly, put the pressure on us and said, “Well, New Zealand can only offer a huge investment in India.”, not only in the form of the $35 billion, but also in the form of intellectual property (IP) and investment through our germplasm of kiwifruit and apples and our knowhow on how to produce those products. The very products that we are seeking to get tariff relief on are the products that we are making India more capable of competing with us on.

I think, on balance, the public should be alerted to the fact that this is not a good deal for New Zealand. This is a great deal for India but it is not a good deal for New Zealand, and that’s why I propose that new title for the bill. Thank you.

Committee of the whole House

I think I wasn’t in the Chamber at the time when you got some advice after the question that I asked yesterday, which was, essentially, what is going to be the effect on the free trade agreement (FTA)? I’m told there’s no effect on the FTA itself—the FTA is the FTA, it’s been approved by the executive rather than being approved by this House. What will be the effect on the operation, the making operational of the FTA, if this bill were not to pass? That’s the question I wanted to ask.

My understanding of what’s happened is that we’ve got an FTA which has been approved by the executive—effectively, it’s had a first reading in this House where we could allude to the bill and whether we agreed with it or didn’t agree with it. Obviously, there’s been an agreement to disagree right from the FTA being able to be read by anybody. New Zealand First has certainly said we don’t agree with the FTA as it came out, so we’ve made that very, very clear.

It’s gone through the executive process—at least, that’s my understanding; it’s a question I asked yesterday. New Zealand First has said no, we don’t agree with that, and we’re told now that we can’t change things, but I am interested in what the impact of this bill—if this bill were to fail, the impact this bill would be on the FTA itself.

I also just wanted to just follow up on Steve Abel’s comments, because in all of these FTAs, essentially we have virtually no tariffs, so we’ve got very little to bargain with in terms of saying “We would like your tariffs to come down”—in this case it’s India, it could be any other country. We have, essentially, no tariffs to give up, so what is it that they will come and say, “Well, we’re giving you a reduction in tariffs; what are you giving us in return?”. What we’ve got is a mix of a migration and study arrangement. We’ve got investing up to $35 billion over the next—or best endeavours, $35 billion over the next 15 years in India, and then, also, we’ve got the transfer of intellectual property (IP).

If I was to look at potential names for this bill, we could have the “India FTA Agreed By Most of the Executive Rather than the Parliament Bill”; we could have the “India FTA Requirement for New Zealand Businesses to, Best Endeavours, Invest $35 Billion in India Over the Next 15 Years When New Zealand Needs that Investment at Least as Much Bill”; or we could have, possibly, the “India FTA Transfer of Valued New Zealand IP and Future Undermining of Our Own Agricultural Industries Bill”.

I just want to make clear, obviously, New Zealand First said right from the outset that we agree there is a need for FTAs. We think FTAs are important, but we don’t think that this is a good deal. The reasons for that not being a good deal I’ve already mentioned, which is the transfer of IP, the best endeavours need to transfer $35 billion of investment into another economy rather than investing it in our own economy, and then there are all the issues around migration, the jobs that go with migration and study, and the impact of that on, particularly, our young people. We’re obviously not commending this bill to the House, but I will be very appreciative of some answers to those questions. Thank you.

Committee of the whole House

Mr Chair, thank you very much. Damien O’Connor asked what would happen to the bill’s names when they’re split; of course, the splitting of the bill is signalled very early and I’ll move that motion at an appropriate time, but the division of the bill was outlined at the Ministry of Foreign Affairs and Trade’s (MFAT) initial briefing to the Foreign Affairs, Defence and Trade Committee. Any member who was there at the time of the briefing would have been aware of that. The division of the bill was also included in the general policy statement of the introduced bill and the legislative statements presented to the House at the bill’s first reading, so any member that was in the House at the time or had an opportunity to read those documents would be aware of it.

It was recommended by the Parliamentary Counsel Office (PCO), and PCO advised that, with a split bill, the India Free Trade Agreement Legislation Amendment Bill—currently Parts 1 to 3 of the bill—will do its work and effectively fall away. The Act—that is currently Part 4—will come into force without including all the amendments of the other legislation. This is done for clarity for the public and for others. Indeed, the second bill will become the India Export Quotas (Apples, Kiwifruit, and Mānuka Honey) Act, and so it will treat that separately than other components.

There have been a lot of questions about whether we consider changing the name of the bill, but the first thing I want to address is why we’re here having this debate today. It is not a result of the executive making a decision; it is a result of there being a very large majority at first reading in this Parliament—a majority of 92 votes to 20-odd—for it to go to a committee, and it was returned from the Foreign Affairs, Defence and Trade Committee with a majority in recommendations for a change. At its second reading, it was the House’s desire for it to go on to the next stage. Therefore, every time we have a debate, there is a vote, and if the majority of members are in favour, then it continues through. What happens if it doesn’t pass? Well, that’s hypothetical.

But, very clearly, if the India – New Zealand free-trade agreement was not to enter into force, then the promises that Mark Patterson made to sheep growers and wool farmers all around the country when he travelled on the taxpayer resource to India to promote wool under the free-trade agreement and said the wonderful thing that there will be carpets for everybody because of the sheep wool that’s grown in New Zealand—well, they wouldn’t get those benefits. To the kiwifruit growers who will have the world’s only tariff-free quota into India of kiwifruit, and outside of that very substantial quota worth $125 million to New Zealand over the next few years in reduction of duty, plus a halving of the tariff right outside of the quota—well, they wouldn’t get those benefits. I suppose our kiwifruit exports to India would not increase in the way they have to every other country where we have a free-trade agreement, including China where, last year, we sold 1 billion kiwifruit to China, a significant return for growers in New Zealand that, in turn, spend it in the provinces and in our communities so that they create jobs.

💬 Hon Damien O'Connor: New Zealand First objected to that too.

That is the point that I was coming to. It is fair that, in this House, different parties will have challenges with trade agreements. Some have supported every single one, some have supported the odd one, and some have supported none. But the China free-trade agreement was not supported by a majority of Government parties at the time, and the Opposition—my party—had to provide support to pass it into law so it could take effect just before an election in that year, not so different to this.

This year, we will export $23 billion worth of goods to China under a free-trade agreement. China has more than a billion people, is larger than New Zealand, and that free-trade agreement has done nothing but create opportunities and jobs and higher incomes for men and women throughout the country over the last 20 years. The India free-trade agreement will do the same.

We haven’t looked at changing the name of it because it is a free-trade agreement. It will deliver for all New Zealanders. I could think up just as many smart comments about positions others take in the House and put them into the bill, but what I’d prefer to do is focus on the substance of the significant opportunity for New Zealand exporters into that market. All over the country, New Zealand businesses, and the people that are working for them, are getting ready to sell more to 1.4 billion people, and with that in mind, I will be commending the bill to the House. The National Party, along with ACT in Government, will be supporting it because trade is in the best interest of New Zealand. I’m yet to see a perfect trade deal, but this one is one of the best that’s ever been negotiated with India.

Committee of the whole House

Thank you, Mr. Chair, and thank you to the Minister for Trade and Investment for that very thorough explanation of the value of the agreement. I think, probably, the question on everyone’s minds as we head towards this last stage of debating the bill is when it will come into force, so the commencement date, which comes into force with Order of Council. Now, that’s not unusual. We’ve seen that occur in relation to other free-trade agreements, and rather beautifully in relation to some, they have come into force on the day in which the international agreement also comes into force. The Comprehensive and Progressive Agreement for Trans-Pacific Partnership is one example of that, and the Regional Comprehensive Economic Partnership is another. No doubt the Minister is currently having conversations behind the scenes with Chinese counterparts—

💬 Hon Todd McClay: Indian.

—sorry, Indian counterparts; my mind was stuck on the other agreement—with Indian counterparts, and I’m just wondering when we can expect the legislation to come into force and whether he envisages that there will be synchronicity and that will come into force with the agreement.

The other question I had was in relation to the title, and if the Minister bears with me, there’s a slight segue, but I do think it’s important and I propose a name like the “Indian Free-Trade Agreement and the Bill of Unusual Search and Seizure Powers”. The reason I do that is because, when we were debating Part 4 yesterday, a very small amount of time was spent on what I thought was quite a significant issue, and that was the change that the Foreign Affairs, Defence and Trade Committee made removing the non-warranted search powers.

I understand that there are other comparable powers in relation to dairy and other free-trade agreements where you have both warranted and non-warranted search powers. I was just wanting the Minister’s view of the framework in this bill, whether it’s appropriate, and whether, in his view, there’s a need for us to think in the future about a search regime that allows for things like a duty of production and inspection powers that doesn’t lean on Part 4 of the Search and Seizure Act, which, in my view, is built for criminal proceedings. I know it’s a slight stretch, but I do think we were pressed for time yesterday and we didn’t manage to get to that important issue.

Committee of the whole House

Well, I don’t think we were pressed for time yesterday. We probably spent five or six hours debating this part, which is a very good use of the House’s time because it allows it to make sure that the bill that will allow New Zealand to deliver commitments, and for New Zealanders to receive the benefits of the free-trade agreement, will work as intended. In as far as the obligations we’re taking on, or what this bill does when it enters into force, the way it always works as a trade agreement is that if the Parliament should adopt this and vote it into law, at a given point of time, it goes to the Governor-General who will sign it off; but, actually, the commitments we make, such as, for example, tariff rates coming down to zero, only take effect when the free-trade agreement (FTA) enters into force.

If that was not to be the case, then Indian exporters could benefit with a lower tariff rate into New Zealand before the FTA comes into force because this is the legal way that we lower the tariff rate. It adds India to another Act where tariff rates will come to zero, but only on the day that the free-trade agreement enters into force. The agreement talks about that, but the exact date will need to be agreed with India when they are also able to show that they can meet their obligations to New Zealand and New Zealand exporters under the free-trade agreement. In respect of the member’s question, no, I haven’t considered changing the name of the bill to the one she suggested.

Committee of the whole House

Thank you, Mr Chair. While we’re on the subject of the title and commencement, I would like to propose an amendment to the title of this Act to the “India Free-Trade Agreement (Offshoring) Legislation Amendment Act”. I propose that because of, as already discussed, the requirement incentives, depending on which side of the debate you’re listening to and whether you’re listening to the Indian Government or the New Zealand Government, on the requirement for private sector investment into India to the tune of US$20 billion. That’s very concerning from our point of view because, ideally, the investment should be going to New Zealand instead of India.

Now, I say this not because I’m not of an internationalist-minded streak, but because I do think that the people and the Government of India are very capable of investing in their own people and in their own industries rather than relying on offshore investment. I just looked at the latest defence spending statistics. I think, in the last year, India spent something like US$93 billion on defence spending.

I don’t think anyone can disagree that, instead of spending money on military weapons and on militarisation, perhaps that money could be better spent on investing in the needs of people in India, rather than relying on New Zealanders to be investing in that to the tune of US$20 billion. I do say the word “offshoring” because, if a New Zealand company chooses to make private investments—for example, if they have a company over here in New Zealand and they choose to invest over in India by starting a call centre or a hub for manufacturing, or something—that would be counted in that US$20 billion threshold. Clearly, we can see that this free-trade agreement (FTA), which this legislation amendment bill helps to enable, is something that will contribute, potentially in a very strong way, to the loss of jobs in New Zealand, at a time when we’re already losing a lot of critical jobs in the regions.

In the electorate of Dunedin, which I am based in, we’ve seen this loss, in terms of the Gregg’s factory near the university. We’re seeing losses like that right across the country, at a time when our own regions and our own industries in New Zealand need the active support of investment here in New Zealand. Why are we enabling, through this free-trade agreement, US$20 billion—which is, I believe, about NZ$35 billion—to be offshored into another country? This is a country which is more than capable. India is an emerging superpower with its own space programme, with its own substantial investments in the defence industries, and with its own foreign aid programme. It really doesn’t make sense that this legislation is encouraging investment into a country which is already relatively prosperous and is relatively capable of looking after itself.

My second point is around the commencement date. It comes into force on a single date by Order in Council. I think the Minister for Trade and Investment already said that, in a previous Parliament, the big New Zealand - China FTA came into force after the election. Well, obviously, we’re two months away from an election—

💬 Hon Todd McClay: Before the election.

Before the election, sorry. I meant: before the election. Now, we’re two months away from the next general election, and three or four parties here in this Parliament, depending on whether you count the Te Tai Tokerau party, do oppose this legislation. So, if you count the number of parties, as opposed to the number of MPs they have in the House, you could argue that a majority of the parties in this Parliament actually oppose the New Zealand - India FTA. We should, arguably, delay it till after the election. Thank you.

Committee of the whole House

Just on that last point, I think it’s very, very important to underline that the House is based on individual members. Each member of this House can vote any way they want—unless their party tells them they’re not allowed to and they might throw them out or put them down on the list as a result—and so, ultimately, if we were to go in the direction the member Francisco Hernandez has just proposed for this House, you may end up with 122 parties here, as opposed to the very loose number he has given at the moment. Probably a more reliable definition of democracy is the one that this Parliament has inherited from Westminster, which is the number of votes, so I think what we will do is see what the final vote will be on the third reading of this bill. If a majority of members are in favour of the free-trade agreement called the Indian - New Zealand free-trade agreement—this bill, which is the India Free Trade Agreement Legislation Amendment Bill—that will be the name, and exporters all over the country will benefit.

I did want to make just one final point about forecasts of growth and delivery for the economy. The Ministry of Foreign Affairs and Trade (MFAT) analysis is, rightly, always extremely cautious about how free-trade agreements will perform. As an example, for the European Union free-trade agreement, whose rights and obligations are very similar to this—in fact, the bill we’re putting through this Parliament now is very similar to the one that enacted the European Union free-trade agreement—MFAT’s analysis was that, over five or six or seven years, we might see an increase of $2 billion worth of exports. In fact, that happened in the first two years—many, many years sooner than they modelled in their forecast. I actually prefer them to be cautious in their modelling rather than overstating, because it is about opportunity.

What free-trade agreements do, when you first negotiate their entry into force, is they talk about tariff savings based upon the amount of exports and trade you have at that time. As an example, when the Chinese free-trade agreement entered into force, with a very large majority of support in this Parliament—although I think New Zealand First probably at the time didn’t support it—ultimately our two-way trade was a couple of billion dollars. This year, we will export $23 billion to them, and we will sell China more than we import from them—a $43 billion two-way trade. If you had looked at the modelling at the time, I’m sure you would have found it was very, very small, but, actually, a quick working out of what our GDP was at the time, compared to the $23 billion we exported this year, it is 12 percent growth annually of GDP on that day. And that was over a 20-year-period.

Now, I’m not saying that we achieve that in the same way, but, with every free-trade agreement New Zealand signs, our exports go up. We sell them more, but we also import more. If we take the example of kiwifruit: with 5 million people in New Zealand, if everyone in New Zealand eats one kiwifruit this year, we sell 5 million kiwifruit. If they have 10, I guess that’s 50 million kiwifruit. Well, Zespri is responsible for $5 billion worth of sales around the world now annually, a new record, and we sold 1 billion kiwifruit to China as a result of the zero tariff rate in there. What trade agreements allow us to do is to produce more to sell to the world, which grows our economy. In effect, even if it was only a 1 percent increase in GDP as a result of this FTA—and I believe it will be much more over time—that’s about $4 billion extra for the economy.

To replace $4 billion, you could have a capital gains tax, you could have a wealth tax, you could have a land tax, or we could back New Zealand businesses to produce more and sell more. We have to remember, when companies in New Zealand export, they earn more for the country, on average they pay their workers more, and they employ more women. I know those opposing the bill are not doing it for that reason, but, actually, New Zealand workers should earn more through being productive. We have an opportunity to sell much more of what we produce to 1.4 billion people. That’s 5 million people working hard to feed 1.4 billion people. New Zealand is a winner under this agreement.

CHAIRPERSON (Teanau Tuiono): Well done, we’re all hungry for kiwifruit right now! Before I take the next call, I have noted that members are using this as an opportunity to summarise—that’s what many people use the title and commencement debate for—but, if you’re going to continue to summarise, you’re not summarising; that’s just a thesis. If you’ve got specific questions focused on the title and commencement, those are welcome, but I would encourage members not to disappear down a philosophical path.

Committee of the whole House

Thank you very much for that guidance, Mr Chair. It is around the commencement date, and I’ve asked the Minister for Trade and Investment this before. I haven’t had a clear answer. The commencement date will be laid out through an Order in Council. It is important, and I think there were questions from my colleague Vanushi Walters about whether it should be aligned, as normally occurs with the introduction of a free-trade agreement (FTA), or for some other reason, should it be another date? I guess the question is: will it be before the election or not, ensuring that Parliament still has the mandate and the authority to bring this into play? Questions around that are really important.

This is a unique trade agreement, and the Minister talks it up. I support his ambition, but I’m also realistic around it as well—that is, the increasing risk that goes with this trade agreement every year that we move down the path towards a 15-year deadline. There is an obligation to promote the investment of US$20 billion. Actually, New Zealand First pointed out yesterday that it was NZ$33 billion; it’s now NZ$35 billion because the coalition Government has mismanaged this economy and driven down the value of the dollar. Thanks very much, New Zealand First. Yes, that bill is going up; the liability is going up.

The commencement date is quite important, because I’m guessing that the Indian Government will be monitoring this agreement from the day that it begins through to that 15-year period. So the question to the Minister is about when he intends to or if he has a date in mind.

The other point I’d like to make around the title of the bill—and my colleague pointed it out—is that maybe it should have been the “Liberation Day Unintended Consequences Bill”, because we have President Trump to thank, in part, for this trade agreement.

💬 Hon Rachel Brooking: Liberation Day.

Liberation Day—yes, that’s right. Liberation Day was his idea. I acknowledge the Minister—I think he seized upon the opportunity when President Trump turned the world of trade on its ear and imposed sanctions on India, like other countries, that were completely ridiculous, and I think we should state that on the record. I think we should be brave enough to say that what the US has done to international trade is just abhorrent. The stability and peace across the globe that has been improved through trade agreements has now been reversed by decisions made in Washington.

I come back to the opportunity that the Minister took up. I guess that India has sought value in driving forward with more trade agreements with more countries, and one of them with New Zealand, and that is great. I think that over time we can seize the opportunities from that whilst mindful—to come back to my first point—that the clock will be ticking on our promotion of trade into India and, I guess, the question of whether the Minister of Foreign Affairs will be committed to promoting that investment—because the Minister of Foreign Affairs and Trade, the Rt Hon Winston Peters—

💬 Hon Todd McClay: Minister of Foreign Affairs.

Sorry—Foreign Affairs; yes. He’s in charge of the overall budget for Ministry of Foreign Affairs, so I’m not convinced—and neither will the Indians be, given New Zealand First’s stance on this trade agreement—that he will commit the resources to promote investment into India, given what we’ve heard from New Zealand First.

So we are facing a bit dilemma, and exporters should be fully aware that in taking up the opportunities through greater access into this market—which are huge and are beneficial, as the Minister said, to our country—there’s also a little cloud on the horizon that they should be mindful of. I’ve certainly, as I’ve said before, had discussions with them at this point. There’s not a huge commitment to a huge amount of investment into India. I hope that will grow over time. It will be through partnerships that we actually consolidate the value of this trade agreement over time, but the commencement date, which is a question for the Minister, is quite critical to those calculations.

Committee of the whole House

Thank you, Mr Chair. I just, Mr Chair, would ask you to note, further to your point about final summaries, that the Minister for Trade and Investment has taken a couple of what I think are quite useful calls; his last two calls, where he’s—

💬 Hon Todd McClay: They’ve all been useful.

Just to be very clear about this, the Minister has expanded on the case for the free-trade agreement, and, in a sense, what he’s done in his last two calls is what we would have liked to have done more substantively, which is probably argue it and hear the case for it.

To acknowledge the Minister, I note that he has worked very hard for this agreement, and it’s not an easy thing to achieve. He’s spent many hours, and he’s travelled across to the other side of the globe, and not spent time with his family, and he’s tried to get this thing across the line. And he should, as much as any of us, have a chance in the fullness of this debating chamber to hear the case for and to hear the case against. I’ve appreciated his recent comments on making the case for the free-trade agreement itself.

One of the specific things that he raised was the value of the China free-trade agreement, which is $23 billion, I believe he said, in terms of export value to New Zealand. I have a very specific question on that, as he has sought to use that as a comparator with this free-trade agreement before us. What is the foreign direct investment commitment in the China free-trade agreement, Minister? Given that you’re arguing that we’re going to get a great return from this India free-trade agreement, the major concern that has been expressed by the parties in this House that are not supporting the current formulation of this agreement is around that foreign direct investment commitment over 15 years of up to $35 billion or more, depending on what the foreign exchange rate is doing to the American dollar. Because, of course, it’s down as $20 billion in US dollars, which could be NZ$35 billion or more or less.

What is the foreign direct investment commitment that New Zealand signed up to in the China free-trade agreement? Because only then can we understand whether the $23 billion of value that we get from our exports to China is greater than the amount that we are expected to invest in China in terms of foreign direct investment. And that is a greater comparator of what we are getting or what we are risking in this India free-trade agreement.

Committee of the whole House

I rise to speak on the title and the commencement date. Just picking up on the points that Steve Abel made, the title of the bill does not reflect what we’re discussing here or what would like to have been discussing here—the India Free Trade Agreement Legislation Amendment Bill. It is far more than a free-trade deal. New Zealand First is all for a free-trade deal with India. It’s in our coalition agreement. We’ve supported other free-trade deals that have gone through in this Parliament. So we are absolutely on board with the free-trade deal.

💬 Hon Damien O'Connor: Stop digging.

Well, the Labour Party should have read this a bit more carefully too, because there are wide implications in this bill, far beyond anything that we’ve ever signed up to with another free-trade deal in the past. This is not the India Free Trade Agreement Legislation Amendment Bill; it is the “India Free Trade, IP Concession, Immigration Relaxing, Outward Investment Amendment Bill” and it should be known as such, and I would propose that it is because there are vast elements to this bill that do not in any way just relate to the tariff reductions, which, obviously, we are supportive of.

We are supportive of trade with India. It’s a big opportunity for us, but what is in this for New Zealand? What are we trading away? We have had very little opportunity to go through some of those immigration settings we’ve got particularly with that community. There has been migrant exploitation—we won’t shy away from that. That community has a track record of exploiting its own. What are the protections in here for student visas with an uncapped 25 hours, currently, in work rights? How are they going to be protected? What is the pastoral care that sits around that?

In terms of the intellectual property (IP), we know that in China Zespri took a court case over there and won on IP. In this deal, it appears that you could drive a bus through the Indian IP arrangements. We could be giving away our G3 kiwifruit variety. We could be giving away our Envy apples and mānuka honey. We really haven’t had the chance to explore that through this debate. Their domestic IP laws are much, much weaker than ours are in terms of plant varieties in the sense that you can, for your own use, use some of these varieties when they are over there. So long before we’ve got 100,000 hectares of G3 growing somewhere in India? Have we got control over those things? We did have control in the China free-trade agreement and in other jurisdictions where we’ve signed up for free trade, but it is not clear to New Zealand First that we are actually not giving away some of our most valuable plant variety IP rights. On the outward investment, there has been crickets on how the $35 billion—as of the exchange rate of yesterday, it was $34.75 billion—that we’re obligated or aspirational—well, it’s not aspirational to me; my aspiration is to have that money invested in New Zealand, and it’s New Zealand First’s aspiration. But we’re on such a preposterous number—it is a preposterous number—and we’ve almost admitted as such; that its aspirational, and “nod, nod, wink, wink”, we’re not actually going to do it.

But that’s not what Prime Minister Modi said on three occasions when he was in this very country. That’s their expectation. We’re signing a deal. We’re going to be asked to vote on a deal shortly that commits New Zealand to $35 billion in outward expenditure into the Indian economy. And there are parties in this Chamber that are prepared to wave that away and not even ask questions about it. That is outrageous. I can’t believe the Labour Party, who have, kind of, made some weak suggestions, saying “Oh, that looks a bit concerning”, have not held their feet to the floor. You had the chance, the Labour Party. New Zealand First has taken a principled stand here; you could have taken a principled stand, but no.

So I will suggest those amendments to the bill’s name because it is not a free-trade agreement.

Committee of the whole House

Thank you, Mr Chairman. As an ex-contract fencer to an ex-farmer, I’ve got to take the shovel away from you to stop digging; you’re going further and further into the hole.

Regarding the commencement and the amendment that New Zealand First indicated it could table here, I just want to speak to that because the member who’s just previously spoken may have forgotten that his leader is the Minister of Foreign Affairs, sits at the Cabinet table with the Minister in the chair, the Hon Todd McClay, and was fully aware of the process of negotiating this agreement all the way through—the Labour Party was not. So all of the conditions that the Government agreed to, the Minister of Foreign Affairs had the ability, at the Cabinet table, to have input into.

💬 Hon Mark Patterson: We read it.

Absolutely.

Trade agreements are never perfect. I agree with the Minister. We know that they’re always a compromise. And on the balance, what is the greater good? Do you sign it or not? The Minister of Foreign Affairs and the New Zealand First Party had the ability to input into and change and adjust and negotiate this trade agreement. And having done so, they now want to step back. But now, in the committee, want to step forward and say, “Oh, no, but we’d like a trade agreement with India.” Well, make up your mind. It will never be perfect. This is not the trade agreement that Labour Party would have negotiated. We accept that it’s the one that the Government has negotiated. We’ve looked at it, we’ve gone through.

The member from New Zealand First makes reference to migrant exploitation—he’s been in a Government that has dumbed down and reduced resources to the Department of Labour that we negotiated to increase again as part of our support for this trade agreement. You can’t have it both ways. Agree to dumb down the oversight of migrant workers in this country through Ministry of Business, Innovation and Employment—because that’s what you did; you agreed to that, to take resources from it to pay for tax cuts—and then bleat about the potential for that to occur in our country. We have never for a moment believed—because we looked at the agreement—that we would be flooded by migrant workers, as New Zealand First said would be. Actually, we appreciate, in the commencement, which is really important—

CHAIRPERSON (Teanau Tuiono): Come back to the title and commencement.

I appreciate that, but I’m kind of speaking to what was indicated might be an amendment tabled in the Chamber around the change of the title to the bill from New Zealand First. So I’m just trying to clarify some of the logic to that and get a response to it, because, in my view, it seems that it’s absolute hypocrisy—absolute hypocrisy. And now, New Zealand First has realised that this is a trade agreement, while not perfect, there has potential and, indeed, has opportunities for exporters across our country. And I acknowledge the Minister for that. That’s why Labour supporting it. It’s maybe not quite as good as he says, but, you know, it’s a good solid agreement that we have to—New Zealand First are stuck out on a limb, not supporting it. Stupid—stupid and hypocrisy to come into this Chamber and then go on about what they care about, when, in fact, they’ve been in the Government that has actually opened up the opportunity for exploitation, unfortunately.

We appreciate the wonderful Indian people who have come into this country, are working in healthcare, are working in services, and in small businesses across our country. They have given vitality, vibrancy, and opportunity for many thousands of Kiwis because of their presence here. That’s why we support the agreement. That’s why we say that this agreement is an opportunity to build stronger relationships and partnerships between India and New Zealand. And the commencement date, which is the part that we’re debating, of course, is still a question for the Minister as to when he thinks this might actually come into force.

CHAIRPERSON (Teanau Tuiono): OK, I’m going to put the question. I think we’re there, folks.

A party vote was called for on the question, That clause 1 be agreed to.

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.

Clause 1 agreed to.

A party vote was called for on the question, That clause 2 be agreed to.

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.

Clause 2 agreed to.

Bill to be reported without amendment.

Committee of the whole House

I move Amendment Paper 791 dividing the bill.

A party vote was called for on the question, That the motion be agreed to.

Ayes 101

New Zealand National 48; New Zealand Labour 34; ACT New Zealand 11; New Zealand First 8.

Noes 21

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

Motion agreed to.

The committee divided the bill into the India Free Trade Agreement Legislation Amendment Bill and the India Export Quotas (Apples, Kiwifruit, and Mānuka Honey) Bill, as set out on Amendment Paper 791.

House resumed.

Report of Committee of the whole House

CHAIRPERSON (Teanau Tuiono): Madam Speaker, the committee has considered the India Free Trade Agreement Legislation Amendment Bill and reports it without amendment and divided into the following bills: India Free Trade Agreement Legislation Amendment Bill and the India Export Quotas (Apples, Kiwifruit, and Mānuka Honey) Bill. I move, That the report be adopted.

Motion agreed to.

Report adopted.

💬 DEPUTY SPEAKER: Those bills are set down for third reading immediately.

India Free Trade Agreement Legislation Amendment Bill

India Export Quotas (Apples, Kiwifruit, and Mānuka Honey) Bill

Legislative Statement