Exporters say they are relaxed about the time it is taking for the government to nail down a commitment from India to resume negotiations for a free trade deal.
Trade Minister Todd McClay will travel to New Delhi next week to continue to build New Zealand’s case to resume talks that ground to a halt nearly a decade ago.
It will be McClay’s second trip to the Indian capital in less than a month, his third since last year’s election, and his fifth face-to-face meeting with his counterpart.
Deputy Prime Minister Winston Peters visited the country in March and Prime Minister Christopher Luxon is expected to follow later this year, though a date is yet to be fixed.
Despite the flurry of high-level contact, agreement between the two sides on when formal negotiations might resume has yet to emerge.
“Both sides are talking about opportunities to increase trade and that includes formal trade architecture,” McClay said.
“We will continue to engage and talk about opportunities and when the time is right the decision will be made.”
McClay said there have been some wins for NZ exporters despite the lack of formal trade talks.
The $250 million log trade was allowed to resume after Indian authorities agreed to waive fumigation requirements earlier this year.
However, getting to the start line for talks to dismantle high tariffs on key pastoral exports will take more effort.
McClay said the government is mindful of the experience of Australia, which signed its own free trade agreement in 2022 after years of trying.
“The Australians have an advantage over NZ because their government prioritised the relationship and did a trade deal.
“The previous Labour government didn’t and that is the reason why we want to make the relationship a strategic priority.”
As well as making improving relations with India a strategic priority, during last year’s election campaign Luxon went further in a televised debate and promised a trade agreement before the end of the government’s first term.
Set against the typically glacial pace of trade negotiations, alongside India’s highly protectionist track record, and sensitivities surrounding key items of importance to it, such as dairy market access for NZ exporters, aiming for an agreement in such a short time is ambitious. It has become even more so given there is still no commitment from India to even start formal negotiations.
Asked whether the PM’s trip later in the year was being targeted for an announcement of a start to talks, McClay refused to be cornered.
“No. It is just a key date in the terms that we are taking the relationship seriously and we are investing in it.”
It is not just government ministers that are increasing their focus on the Indian market.
Dairy Companies Association of NZ executive director Kimberly Crewther attended a conference there last month along with other NZ industry figures.
Representatives of the Indian dairy industry have also travelled to NZ in the past year.
She was relaxed about the government’s gradual approach to getting India back around the negotiating table.
The shortfall between Indian milk supply and its consumption would only grow as time went by.
“That relationship building is going to form the foundation for positioning for NZ to be at the front of the queue when India starts importing.
“We support the strategy.”
The Labour government came in for criticism from some meat exporters for not having done more to re-engage India in trade talks.
That criticism became louder after Australia’s deal, which scrapped 30% tariffs on sheep meat imports.
NZ exporters still face those tariffs and continue to struggle to make headway in the market.
Despite that, Meat Industry Association chief executive Sirma Karapeeva said she backs the approach the government is taking.
“Government-to-government engagement is an important part of building a solid foundation for any future trade talks, so the meat industry is happy to see the government is engaging with India.
“It is an important market with the potential to grow.”
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