Christopher Luxon, the prime minister of New Zealand, is visiting India from March 16-20 at the invitation of his counterpart, Prime Minister Narendra Modi. Timely as it is, the visit marks a pivotal moment in the evolving bilateral relationship between the two Indo-Pacific democracies. Historically underemphasized, Delhi-Wellington engagement is now gaining strategic and diplomatic prominence in economics and trade, diaspora, education, and, more importantly, the strategic front.
Luxon’s role as the chief guest at this year’s Raisina Dialogue on March 17 – a high-profile Indian public forum on geopolitics and geoeconomics – signals New Zealand’s intent to enhance its engagement with India on multiple diplomatic channels. A high-level delegation running the gamut from business and academia to media and diaspora figures is accompanying Luxon, signifying the importance he has attached to his India tour.
For its part, India’s Look East Policy in 1992 under Prime Minister P. V. Narasimha Rao has led to a series of enhanced ties with Southeast Asia and the Pacific Region. India became a dialogue partner of ASEAN in 1995, the Pacific Island Forum in 2002, and the East Asia Summit in 2005.
New Zealand, likewise, has seen the potential of the vast Indian consumer market and has shown interest in boosting trade ties with India. Wellington also sees India as a safe bet to counter China’s assertive rise in the Indo-Pacific region.
One of the key focus areas of Luxon’s visit is the potential signing of a free trade agreement (FTA), which could significantly transform bilateral trade relations. Currently, India-New Zealand trade is modest at US$2.83 billion, highlighting substantial untapped potential. New Zealand, whose foreign policy is driven by trade and security considerations, views India as a critical partner for diversifying its economic and trade linkages. Luxon’s scheduled discussions with business leaders in Mumbai further emphasizes the intent to deepen economic engagement.
However, long-standing challenges remain. The FTA negotiations, initiated in 2009, have faced repeated delays due to India’s protective economic policies. India maintains high tariffs on agricultural and dairy products to safeguard domestic livelihoods and ensure food security, particularly for its rural population. While this protectionist stance aligns with India’s broader developmental strategy, a phased liberalization could facilitate mutually beneficial trade expansion.
India’s evolving trade posture provides optimism. Recent FTAs with Australia (2023), the UAE (2022), and Mauritius (2021) demonstrate Delhi’s willingness to engage in comprehensive economic agreements when strategic interests align. Furthermore, India is working on finalizing FTAs with the United Kingdom, the EU, and the United States. Given these precedents, it is plausible that New Zealand and India will eventually overcome trade negotiation hurdles, fostering a more integrated economic partnership.
Beyond trade, the Indo-Pacific construct offers new avenues for collaboration between India and New Zealand. Historically, New Zealand’s skepticism toward India – particularly concerning its nuclear policies – posed a diplomatic hurdle. However, India’s consistent track record in arms control and disarmament has alleviated these concerns, paving the way for deeper strategic engagement.
A key driver of this partnership is China’s growing assertiveness in the Indo-Pacific. New Zealand faces a critical foreign policy challenge in interpreting and responding to China’s expanding strategic footprints in its immediate neighborhood. One recent example is China’s signing of a Comprehensive Security Partnership with the Cook Islands, a territory in free association with New Zealand. The secrecy with which the agreement was signed, coupled with the Chinese People’s Liberation Army Navy’s (PLAN) recent unannounced live-fire drills armed with “extremely capable” weapons near the Tasman Sea, underscored the urgent need for Wellington to recalibrate its regional strategy.
Delhi is equally jittery about Beijing’s strategic intentions. China’s checkbook diplomacy, the secrecy of its Belt and Road Initiative investments (particularly in smaller countries), and its assertive and expanding military presence beyond its immediate areas are a cause of concern – not just in the Pacific but also in the Bay of Bengal and the Indian Ocean region. It is time regional stakeholders convened an honest exchange of thoughts on what kind of neighbor China should be and what kind of neighbor it has been.
Luxon’s visit to India at this juncture is particularly significant. India, as a major Indo-Pacific player and a key Quad member, is increasingly seen as a counterbalance to China’s assertiveness. Strengthening ties with India allows New Zealand to diversify its diplomatic and security partnerships while reinforcing a rules-based regional order.
Beyond trade negotiations and geopolitics, there are numerous domains where India and New Zealand can bolster bilateral cooperation. Climate change, clean energy, the blue economy, the higher education sector, and research on Pacific Island nations present promising opportunities. New Zealand’s academic and scientific institutions could collaborate with Indian universities to advance studies on climate resilience and sustainable development in the Pacific.
Such initiatives align with India’s Forum for India-Pacific Islands Cooperation (FIPIC) and would strengthen its benign regional presence. Additionally, both nations can collaborate on cultural preservation initiatives for Pacific Island communities affected by climate-induced displacement.
Luxon’s visit represents a strategic recalibration in India-New Zealand relations. While trade discussions remain a key focus, the broader geopolitical and collaborative dimensions of the partnership should not be overlooked.
In a rapidly evolving Indo-Pacific landscape, deeper India-New Zealand engagement could yield long-term economic and strategic dividends. By addressing economic barriers and leveraging complementary strengths, the two nations can forge a robust and multidimensional partnership that aligns with their respective national interests.