That’s a tall order.
Particularly, as Labour holds the political cards after Peters slagged the FTA as a “bad deal” and said New Zealand First would oppose it, in a press statement issued minutes before the Prime Minister’s announcement.
National and Act will need Labour’s votes to get the empowering legislation passed.
McClay had briefed Labour leader Chris Hipkins and Labour’s trade spokesman Damien O’Connor ahead of the public announcement with the latter giving his cautious approval. McClay will make his officials available to Labour for behind scenes briefings.
On the Cross Party Lines podcast just before Christmas, former cabinet ministers Chris Finlayson (National) and Phil Goff (Labour) were in agreement that the Indian deal deserves bipartisan support.
Finlayson singled out the FTA as potentially the Government’s major achievement for this term. Goff played up the desirability of the two main parties taking a bipartisan approach, saying that when he was Trade Minister he had invited Tim Groser, his then National opponent, to join the New Zealand delegation to ministerial meetings of the World Trade Organisation (Groser attended the Hong Kong meeting).
McClay confirmed he will invite O’Connor to join him and officials at the WTO Ministerial Conference (MC14) at Yaounde in Cameroon from March 26-29.
Notably, McClay has been elected as one of three vice-chairs for the meeting, which will be under the leadership of Cameroon Trade Minister Luc Magloire Mbarga Atangana.
He will also be a vice-chair at the OECD Ministerial Council meeting in Paris mid-year.
Bipartisan support is crucial.
When the major political parties are aligned, it not only ensures smooth passage of agreements through Parliament but also provides stable, consistent public messaging – making it clear that New Zealand’s trade strategy is about national interest, not political advantage.
O’Connor is well aware of this. Less experienced political colleagues may need some guidance.
National felt they had secured bipartisanship on infrastructure when Labour’s Barbara Edmonds held the portfolio spokesmanship – the scope was reduced when Kieran McAnulty took it over.
Domestically, the business and export sectors are reassured there is no risk of reversal and international partners have confidence that New Zealand’s commitments will endure beyond any one government.
There have been instances where bipartisan support fractured. Particularly, with the Trans-Pacific Partnership (TPP) which was opposed by Labour in Opposition; but ultimately supported when in Government following modifications to become the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).
That opposition was unfortunate.
In India’s case it will not agree to further modifications to the FTA. It is what it is. Narendra Modi’s Government has moved on.
India will be relying on commitments made in trade negotiations being honoured regardless of changes in government. This is all about political stability, long-term policy continuity, and reliability – qualities that make New Zealand a trusted and credible partner in free trade agreements and multilateral forums.
This is important.
New Zealand does have a reputation as an “honest broker” which is why so many of our Trade Ministers from both sides of Parliament have been invited to play leading roles at the WTO and the G20.
There were other areas for potential conflict.
McClay worked in advance of the announcement to defuse public opposition from the New Zealand dairy industry to the FTA which does not deliver open access to the commodity trade.
Key figures agreed to mute their public criticism.
But the sector does stand to benefit from the India FTA in several meaningful ways – particularly from re-export opportunities where NZ dairy companies can partner or set up facilities in India to process/value-add New Zealand product and then re-export to markets like Southeast Asia, gaining access to new regional supply chains.
McClay nominates Sri Lanka – which has an FTA with India – as one those possibilities. Direct access to Sri Lanka has historically been difficult for New Zealand exporters.
The FTA also gives New Zealand the right to negotiate better dairy access automatically if India improved terms to another country in the future.
McClay is now exploring future trade expansion in several key regions and agreements.
They include:
- Africa: Conversations are being initiated with countries such as Nigeria and Morocco to lay the groundwork for future FTAs, anticipating the region’s rising economic significance.
- South America: New Zealand is engaging with Mercosur, deepening trade relationships with Brazil and Peru, and considering renewed negotiations with the Pacific Alliance.
- Asia and Indo-Pacific: New Zealand is looking to continuing leadership and expansion within the CPTPP; while prioritizing deeper engagement with India, China, the Middle East (UAE, GCC), and further integrating regional economic strategies.
- Europe: McClay has agreed to European Union Trade Commissioner Maros Sefcovic’s request for a second New Zealand–EU FTA summit to be held in Europe and advancing structured dialogue between CPTPP and the EU.
- US: McClay intends to pursue both sub-national (state-level) and national trade opportunities, including potential new partnerships and trade missions.
New Zealand’s trusted reputation and proactive diplomacy is opening doors across multiple regions and multilateral frameworks.
But the deals likely to generate the largest immediate benefits for New Zealand exporters are:
- India FTA: Offers immediate and phased tariff reductions, improved access for high-value and bulk exports (including dairy in the future), new investment rights, and labour mobility – all in one of the world’s biggest and fastest-growing markets.
- Middle East (UAE, GCC): Expected to deliver quick tariff reductions and access to dynamic markets for premium exports such as dairy and meat, with strong potential for growth and diversification.
- European Union: Deepening ties and removing remaining barriers will enhance access to a high-value, stable market for agri-food, tech and services.
Medium- to long-term, major opportunities will likely come from:
- South America: Improved connectivity, collaboration with blocs like Mercosur, and targeting emerging markets like Brazil and Peru.
- Africa: Early engagement positions New Zealand for future deals as African economies and consumer demand expand significantly.
- CPTPP expansion: Welcoming new members further increases stable, rules-based market access for exporters.
McClay underlines these efforts will diversify New Zealand’s export destinations, reduce over-reliance on single markets, and unlock sustained opportunities for businesses across multiple sectors.
On top of this there are trade missions to organise for India, China and the US among others.
A busy year ahead.
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