The delegation accompanying New Zealand Prime Minister Christopher Luxon to India is the largest ever, carrying with it many expectations of "awakening" relations with the country on track to become the world's third largest economy...
The five-day visit (March 16-20) with two destinations in New Delhi and Mumbai is, as described by RNZ, “a charm offensive designed to boost trade and security ties with this rapidly growing economic giant”.
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| Prime Minister Narendra Modi extended an invitation to his counterpart Christopher Luxon to visit India at a meeting on the sidelines of the East Asia Summit (EAS) in Vientiane, Laos on October 10, 2024. (Source: X) |
“Start over”
During his stay in New Delhi, Prime Minister Christopher Luxon will hold talks with host Prime Minister Narendra Modi, meet President Droupadi Murmu and deliver the inaugural address at the Raisina Dialogue, India's premier multilateral defence and security forum.
The New Zealand Prime Minister is scheduled to visit Mumbai from March 19-20, interacting with Indian business leaders and representatives from various walks of life.
Speaking to the media before leaving Wellington, Mr. Luxon affirmed his determination to build a deeper relationship with the world's most populous country and one that is on track to become the world's third largest economy by 2030.
India “is truly one of the multipolar leaders in the world today… it is the fourth largest military spender,” said Prime Minister Luxon.
Not to mention, the South Asian country has a “rapidly growing middle class, creating huge trade opportunities” while “sadly, only 1.5% of our exports go to India”.
Insisting that the relationship “didn’t exist” before the coalition came to power, the New Zealand leader admitted: “We have to start from scratch.”
Meanwhile, speaking to RNZ , Labor's trade spokesman, Damien O'Connor, a former trade minister, denied that his party had neglected its relationship with India, saying the Covid-19 pandemic had simply hampered travel opportunities.
| The visit "reaffirms the continued commitment of both countries to further strengthen bilateral relations in all areas and deepen the close ties between our peoples," according to India's Ministry of External Affairs. |
20 years of "weaving dreams" of FTA
During the 2023 election campaign, the former Luxon businessman pledged to secure a free trade agreement (FTA) with India within his first term. According to RNZ , the promise is “highly risky” as formal negotiations have yet to resume and the opposition has called the deadline “completely unrealistic”.
This year marks 20 years since New Zealand launched its FTA plan with the billion-people market in 2005, when the government of Prime Minister Helen Clark (1999-2008) set up a joint study group with India to examine the feasibility of a free trade agreement. Then Prime Minister John Key (2008-2016) spent five years promoting the agreement before negotiations collapsed in 2016. Under Prime Minister Jacinda Ardern (2017–2023), trade negotiators “froze” the agreement with India, instead focusing on more promising agreements such as with the European Union and Asia-Pacific countries.
But the current Prime Minister of Luxembourg is not giving up. He has said he will remain “a real commitment” to deepening trade ties with one of the world’s fastest-growing economies. “We will do everything we can to really, really boost trade,” he said, especially “looking at a much more comprehensive economic partnership and how we can advance that relationship.”
In fact, India has become a more open economy and signed other trade deals in recent years. It is also important that New Zealand may be willing to compromise on dairy, which has been a major sticking point in previous negotiations.
India’s dairy model relies on smallholder farmers. Allowing New Zealand milk to flow freely into the market could bankrupt these farmers before the industry has a chance to modernize, not to mention setting a precedent for other countries seeking market access. Commerce and Industry Minister Piyush Goyal has asserted that dairy is a sensitive sector in the country as it involves livelihood issues of small farmers and there are no plans to offer any kind of duty concessions under any FTA in the sector. |
Same and different
Prime Minister Luxon’s visit to India comes amid New Zealand’s concerns about China’s growing assertiveness in the Indo-Pacific region. China caused alarm last month when it sent three naval vessels into the Tasman Sea to conduct live-fire exercises, RNZ reported.
Speaking to the media, Mr. Luxon commented that India is “very much in line” with New Zealand's views on security and stability in the region.
Wellington needs to “do more” with New Delhi as a security and defence partner, such as “joint defence exercises, visits and a whole host of other things”.
According to political and economic journalist Dan Brunskill (New Zealand), during this visit, Wellington will try to demonstrate its ability to contribute to regional security and cooperate with India to maintain the balance of power in the region. This has the added benefit of creating the broader relationship needed for a trade deal.
While India may be sympathetic to New Zealand’s concerns about China, RNZ said the two sides would have “less alignment” on the conflict in Ukraine. India has maintained a neutral stance and has never criticised Russia’s military campaign in the Eastern European country.
Mr Luxon is certain that the conflict, which has lasted more than three years, will be raised in his talks with his counterpart Modi, and he will make New Zealand’s position clear: “There is no change for us. We support Ukraine.”
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| Premier Christopher Luxon and Trade Minister Todd McClay spoke about the benefits of an FTA with India... (Source: Waikato Times) |
“A pivotal moment”
Former National Party MP Kanwaljit Singh Bakshi, who was part of the delegations that accompanied Prime Minister John Key (2008-2016) on his visits to India in 2011 and 2016, will also be present on the current Prime Minister's visit.
Affirming that Prime Minister Luxon “has always expressed a strong commitment to deepening relations with India”, Mr. Bakshi assessed that this visit with a “huge” delegation “underlines the importance of nurturing bilateral relations, especially in important areas such as trade, education, technology, tourism and cultural exchange”.
In particular, the New Zealand leader's invitation to be the keynote speaker at the Raisina Dialogue is "a landmark moment" in India-New Zealand relations, according to Mr. Bakshi, New Zealand's first lawmaker born in India.
Mr Luxon “will be the first non-European leader” to appear in that capacity at India’s main multilateral forum. According to Mr Bakshi, the gesture “reflects India’s willingness to improve relations with New Zealand” as well as “growing recognition of India’s global influence”.
In 2023-24, New Zealand exported US$0.84 billion worth of goods and services to India and imported US$0.91 billion, for a total two-way trade of US$1.75 billion. India mainly imports wool, iron, steel, aluminium, fruits and nuts from New Zealand. India's main exports to New Zealand are pharmaceuticals/medicines, machinery, finished textiles, pearls, precious stones and metals. |
Expectations from business
The large community delegation “shows the government is trying to bridge the relationship gap that we have been talking about for a long time,” said Ranjna Patel, co-founder of Nirvana Health Group, New Zealand’s largest independent primary health care network. When working with the Indian community, “the focus is on building relationships first. The business part will come later.”
The famous businesswoman “hopes she can contribute a part to that relationship”.
Another Indian-origin businessman, Sudesh Jhunjhunwala, CEO of Sudima Hotels, noted that India is a rapidly growing economy and New Zealand should participate in that growth through investment, tourism, education or FTAs.
The Indian community is “a very large minority in New Zealand”. The two sides need to leverage their cultural proximity “to bring the two countries closer together”.
Mr. Sudesh Jhunjhunwala also expected “the bilateral relationship to be strengthened with meaningful outcomes such as direct flight connectivity with India and side trade agreements not related to sensitive products such as milk”.
On the other hand, Mr. Bharat Chawla, Chairman of the India-New Zealand Business Council (INZBC) said, “We have been working hard to build partnerships and collaborations with Indian industry in areas such as kiwifruit, education and fintech.”
Mr Bharat Chawla also reiterated the key recommendation of last year’s INZBC report, “building a broader relationship focused on trade as well as cooperation in science, education, culture and sports”.
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Much is expected of the trip, which begins tomorrow (March 16). The presence of the New Zealand leader in India’s two largest cities is unlikely to result in a breakthrough in the signing of an FTA, or even a promise to restart negotiations. But as Prime Minister Luxon admitted, “for me, the success is that we maintain the momentum in the individual relationships that we have built over the last 16 months and that we see a shift in defence, trade and people-to-people ties after this visit.”
Prime Minister Christopher Luxon is accompanied by a business and community delegation on his visit to India. The business delegation includes 40 influential leaders from sectors such as aviation, banking, agribusiness, education and technology. This group represents the backbone of the New Zealand economy, bringing together expertise and innovation to foster closer trade ties with India. The community delegation included former Governor-General Anand Satyanand, prominent people of Indian origin, representatives from various New Zealand communities and members of Parliament. The delegation emphasised the importance of people-to-people and cultural exchanges in strengthening bilateral relations, aiming to build bridges between communities and promote cultural exchanges. |
Source: https://baoquocte.vn/thu-tuong-new-zealand-tham-an-do-cuoc-tan-cong-quyen-ru-hay-no-luc-danh-thuc-moi-quan-he-khong-ton-tai-307726.html
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