India, New Zealand to initiate free trade pact
India and New Zealand have initiated steps to ink a FTA, but it could be a while before this becomes a reality.business Updated: Apr 23, 2007 00:31 IST
India and New Zealand have initiated steps to ink a free trade agreement (FTA) but it could be a while before this becomes a reality.
"We have agreed to a study on eventually concluding a FTA. This study will go into issues like how each side can benefit from such an agreement," New Zealand Trade Minister Phil Goff told the agency.
He was speaking after a meeting with Indian Trade and Commerce Minister Kamal Nath.
"We should be able to launch this study by the end of the year. It will lay down the terms of reference for further negotiations. Based on this, we will proceed ahead," added Goff, who also holds the portfolios of defence and disarmament and is also the associate minister for finance.
Geoff was here over the weekend on a two-day visit during which he also met External Affairs Minister Pranab Mukherjee, Defence Minister AK Antony, Agriculture Minister Sharad Pawar and Sports Minister Mani Shankar Aiyar.
The minister hoped for greater inflows of tourists and students into his country of four million. New Zealand is home to 105,000 Indians.
India currently has a trade imbalance with New Zealand, with exports of $250 million and imports of $355 million.
"Given our enormous commonalities of democracies and a common language, there is enormous potential for further growth. Our combined trade is only half-a-million dollars compared to $7 billion with China, with which we have very little in common," Goff pointed out.
Food and beverages, commodities like coal and timber and agricultural technologies, as also tourism, were the key areas in which the two countries could improve their interaction, the minister said.
Speaking about the need to reduce trade barriers, Goff pointed out that a bottle of wine that cost $10 in New Zealand attracted customs duties of between 100 and 560 percent in India.
This apart, New Delhi's law relating to the import of agricultural and dairy products and also meats "are far above international standards and need to be lowered", the minister contended.
"Take apples. They attract 50 percent customs duty when we have two growing seasons and we are not in competition with your local produce. I think Indians are well entitled to our very delicious apples!
"In my interaction with (Kamal) Nath, I stressed the need to bring these down to realise the full potential of our economic ties and he promised to examine the issue. It was in this context that we agreed to a study on the feasibility of an FTA," the minister stated.
Speaking about New Zealand's tourism potential, Goff said some 20,000 Indians visited his country but many more could do so.
"Air New Zealand (the country's flag carrier) has shown interest in initially starting a weekly flight out of Mumbai. We hope Air India will also show similar interest," he stated.
On the academic front, some 3,000 Indians are currently enrolled in New Zealand universities where they receive scholarships amounting to 3/4ths of the annual tuition fees - the same as what natives get.
"We are home to three of the top 100 universities in the world. We are a safe, friendly and environmentally conscious country. We hope to see more students and tourists in New Zealand," the minister said.