Trade group welcomes free trade initiative

23 April 2007

Trade group welcomes free trade initiative

Auckland based India Trade Group (ITG) Inc has welcomed New Zealand’s initiative to enter into a Free-Trade Agreement (FTA) with India.

“As an emerging economic giant, India offers immense trade and commercial opportunities that would benefit both countries,” ITG chairman Dr Richard Worth said today.

“Although the bond between New Zealand and India dated back three centuries, neither country had fully realised the potential for stronger trade partnership.

“An FTA with India would stimulate growth and although a small country, New Zealand can contribute to the economic and industrial growth of India through a number of avenues. It is also important to identify our strengths and determine the areas of cooperation as a part of the FTA process”.

Trade Minister Phil Goff announced today that New Zealand and India had agreed to launch a joint study to find out the implications of a free trade deal. The announcement followed his meetings with India’s commerce minister Kamal Nath in New Delhi last week.

“With economic growth averaging around 8% per annum over the last three years, India is becoming an increasingly important market and trading partner for New Zealand. However, that trade still only represents a fraction of its potential. New Zealand–India two-way trade at less than $650 million compares with nearly $7 billion in our two way trade with China,” Mr Goff said.

Dr Worth, whose private visit to India last year led to the formation of the ITG, said there were several areas that offered immense possibilities for strengthening bilateral relations between the two countries.

“Trade, investment, education, tourism and culture are among the sectors that would not only accrue business opportunities but also build a stronger bridge of goodwill and understanding between New Zealanders and Indians. ITG would work together with the two governments and various departments and agencies to achieve the objective of a free trade agreement,” he said.

ITG director Tim Groser said he was pleased with the development and hoped that the joint study would lead to an FTA with India.

“While New Zealand needs a new strategy to develop our linkages with one of the fastest growing economies in the world, a good place to start would be to see if India would be interested in studying an FTA with India.

“India is already doing this with Australia and others in the Asia Pacific region,” he said in a press article soon after his return from India in March.

A former diplomat, Mr Groser chaired WTO’s agricultural negotiations in August 2005 and was in New Delhi on the personal invitation of Mr Nath to attend an international conference convened to salvage the WTO Doha Round of talks.

He said he had informally discussed the issue of an FTA between New Zealand and India with Mr Nath and said a direct air link between the two countries was essential to promote trade, investment and tourism.

Dr Worth agreed, saying that the ITG was working with the concerned to achieve the objective.

“Direct air services could also be established through private sector initiatives. India has a number of highly successful private operators,” he said.

ITG deputy chairman and chief executive Giri Gupta said a free trade deal would enable New Zealand to add value to its existing relationship with India.

“We are hopeful that the joint study would address the inherent challenges and lead to an early trade agreement, which would in the long term interest of the two countries,” he said.

ENDS

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