New Zealand-India relationship 'rejuvenated' - but what about that $20 billion commitment?

Saturday, 11 July 2026

The trip marked the first visit of a world leader of Modi's status since Bill Clinton Presedential visit in the 1990s.

Narendra Modi attended a business event in Auckland on Saturday, marking the first time an Indian PM has visited New Zealand in 40 years.

He described the Free Trade Agreement with India and New Zealand as a “turning point” in the relationship between the two countries.

PM Christopher Luxon rejected that Modi had misunderstood New Zealand’s commitment to invest $20 billion worth of private sector exports to India over 15 years.

India Prime Minister Narendra Modi has called for an 'ambitious business programme' out of the free trade agreement signed with New Zealand in April.

At the business event in Auckland, Modi gave a speech for nearly 10 minutes, outlining key aspects of the agreement for India.

Christopher Luxon and Narendra Modi pictured at Government House.

“Friends, this meeting is taking place at a time when the relations between India and New Zealand are at a turning point,” Modi said.

“This year, a free trade agreement was concluded between both countries in a record time of nine months.

PM Christopher Luxon speaks about New Zealand's commitment to promote investment into India.

“This will bring new opportunities for all of you, related to market access, investment, services, technology and talent mobility,' Modi said to the crowd of business and political leaders.

The Indian PM was “confident” that “with a new enthusiasm and new energy” the goal of doubling bilateral trade by 2030 could be achieved.

Modi highlighted a controversial aspect of the agreement in his speech, saying, “New Zealand has committed to invest $20 billion in India over the next 15 years”.

He said, “this is not just investment, it is also a commitment to partner with India in its development journey”.

Previously, Trade Minister Todd McLay said the provision “doesn’t require us to invest in India. It requires us to promote investment.”

Both prime ministers were pleased to have strengthened the relationship between India and New Zealand.

Prime Minister Christopher Luxon was asked whether Modi had misunderstood the commitment, as in February, the Government said it had agreed to 'promote investment' from the private sector into India.

“It's all well understood, a commitment to promote,” Luxon said. “We understand what we agreed in the FTA. Both sides understand that well.”

Chris Hipkins says the Government must explain key elements of the India free trade agreement, including a clause committing New Zealand to US$20b in investment. He warns exporters could be left exposed if market access is later scaled back.

“This is two countries that have a lot of history together, a long friendship, but really haven't had new things to feed the relationship going forward, and that's why the FTA was so important.”

In February, Labour leader Chris Hipkins was critical of the $20b investment clause.

“That’s far greater than any investment we saw from New Zealand into China following the signing of the China FTA, which actually is a bigger agreement than the India one.

“We’re concerned about the implications of them being able to pull the pin on New Zealand exports to India should we not meet that target, given the Government has no plan in order to demonstrate that it will meet that target.”

Hipkins said he feared New Zealand businesses could start exporting and doing trade with India, only for the country to not meet the $20b target, leaving them “high and dry” should India decide to dial back access to its market.

“That could be really bad for New Zealand business.”

The Indian economy was described by Modi as “the world's fastest growing major economy”.

Modi was welcomed to New Zealand with a pōwhiri at Government House.

“India is not just a market, but a launchpad for global growth.”

He outlined how India was a digital economy leader, and was pursuing space ambitions.

“We have opened up the space sector for private participation. Today we have over 400 space startups in India, and one of them has even become a unicorn now.”

“The companies of both countries can work together on India's space ecosystem, and they can work on small satellites, remote sensing and ocean monitoring.”

Before closing with some comments about New Zealand's 100 years sporting relationship with India, Modi expressed commitment to working with Māori.

“I would like to acknowledge the Māori business leaders in particular. In both the Indian civilisations and in the Māori tradition, nature, community and sustainability are deeply respected,” Modi said.

“In our FTA too, a special place has been accorded to opportunities for Māori businesses. Combining these shared values we can create a new model for inclusive and sustainable trade.”