Former Prime Minister Sir John Key slams ‘clown’ opponents of India free trade agreement

Anyone opposed to New Zealand’s free trade agreement (FTA) with India is “a clown”, Sir John Key says.

The former Prime Minister took aim at those against the agreement – signed in April – which was vocally opposed before and after by Government coalition partner NZ First.

“I reckon if you’re opposed to the FTA, you’re a clown and you don’t have much knowledge about economics, because here are the economics”, Key told the Mike Hosking Breakfast.

“They are 1.4 billion people, we are 5 million. They have enormous restrictions on us going into their market. We got rid of all of ours under the Douglas-Lange Government.

“We’re giving up nothing. They might not be giving up everything. Yes, of course it would be so much better if we had better dairy provisions and the likes, but actually, they’re giving up a lot.”

NZ First has been heavily critical of the agreement, including its immigration settings and investment clause.

The party’s leader Winston Peters has been a long-standing critic of the investment clause, which talks about US$20 billion ($34b) worth of private investment by New Zealand firms in India over 15 years.

The Indian side of the argument say this figure is a promise by New Zealand – the New Zealand side argues the Government is only obliged to “promote” investment in India to hopefully reach the goal.

After Indian Prime Minister Narendra Modi said three times during his visit to Auckland last weekend the figure was a “firm commitment” from New Zealand, Peters told the Herald it was “breathtaking stuff” that Modi could come to this country and there still be confusion.

In April, Labour leader Chris Hipkins said his party would support the free trade deal but warned exporters could have their market access revoked if New Zealand can’t fulfil the investment commitment.

The FTA, now before Parliament for approval and expected to be ratified later this year, will mean 95% of New Zealand’s current exports to the world’s fastest-growing economy will be tariff-free or have sharply reduced tariffs.

Early estimates suggested the agreement could generate an additional $1b in exports annually over the next 20 years, Trade and Investment Minister Todd McClay said.

The trade deal didn’t secure New Zealand full access to India’s tightly protected dairy market, long one of the biggest hurdles in trade talks.

Core dairy products are excluded, but tariffs on bulk infant formula and other high-value dairy preparations will be eliminated over seven years.

The deal would get better over time, said Key, noting India’s growth.

“If you close your eyes and wake up in 10 or 15 years’ time, you name for me the superpowers in the world because I can do it for you right now – the United States, China, and India.

“They are growing at 7% a year in India, if not more. You tell me that we don’t want to hitch ourselves to that wagon?”