Labour backs NZ-India Free Trade Agreement
- Sydney (23 April)
The New Zealand Labour Party will support the New Zealand–India Free Trade Agreement (NZ-India FTA) after securing labour protection and immigration commitments from the New Zealand Government, the party said on 23 April.
The Government will expand funding for New Zealand’s Labour Inspectorate, speed up visa processing times for workers looking to change employers, and pass the Modern Slavery Bill through its first reading by early November, the Labour Party said in a statement.
New Zealand Trade Minister Todd McClay plans to sign the deal – which will reduce tariffs on 95% of New Zealand’s exports to India – in New Delhi next week, as part of a wider Asian trade trip, he said.
But Labour has warned that the NZ-India FTA contains investment promotion provisions that create risks for New Zealand exporters.
“If this government, or subsequent governments, don’t invest enough in the promotion [of Indian investment], then the Indians can claw back concessions that this FTA offers,” Labour’s Trade Spokesperson Damien O’Connor said.
New Zealand has committed “to promote investment into India with the aim to increase private sector investment by US$20 billion (A$28 billion) over 15 years,” according to the Ministry of Foreign Affairs and Trade (MFAT). The FTA’s investment promotion provision is not subject to dispute settlement.
The New Zealand Government needs the support of either the Labour Party or the Green Party to ratify the NZ-India FTA because New Zealand First – a member of the coalition government – opposes the deal.
“Regrettably, [the NZ-India FTA] is a bad deal for New Zealand. It gives too much away, especially on immigration, and does not get enough in return for New Zealanders, including on dairy,” New Zealand First leader Winston Peters said on 22 December.
The NZ-India FTA does not include significant dairy tariff reductions. But India will consider dairy tariff cuts if it offers concessions to other countries in the future.
Labour’s support for the NZ-India FTA comes weeks after 44 exporters and peak body groups called on all political parties to support the deal.
“An FTA with India is not a luxury; it is a strategic necessity for our economic security,” the group – including Beef + Lamb New Zealand, Federated Farmers, and NZ Tech – said in a letter on 13 April.
By Avinash Govind