With the Free Trade Agreement between New Zealand and India remaining a non-starter even after a decade, all eyes are now on leveraging the Regional Comprehensive Economic Agreement (RCEP), which includes ten countries of the ASEAN (Association of Southeast Asian Nations) grouping, as a practical alternative.
Batting for the RCEP as the way forward and a win-win for all parties concerned was NZ Minister for Trade and Export Growth David Parker, chief guest at the event, jointly hosted by INZBC & the ASEAN NZ Business Council. The event was held on 25 May 2018, at The Heritage Hotel, Auckland.
Mr Parker used the term ‘pluri-lateral agreement’ to describe a trade deal that countries with a common interest would forge to benefit all parties involved, such as RCEP. As well as the ten ASEAN countries, RCEP includes New Zealand and India besides a few others.
“RCEP has the potential to be a high-quality partnership agreement, mutually beneficial to India and New Zealand,” Mr Parker said.
He said Kiwis needed to be convinced that trade agreements work. NZ’s FTA with China is a case in point: trade volumes had touched $10billion both ways.
“RCEP is important for the future of New Zealand,” he said. “There is significant potential for New Zealand’s economic growth.”
At $2.6billion, India is New Zealand’s tenth largest trading partner. As well as trade in goods, services was also growing and has increased by two-and-a-half times than what the volumes were six years ago, Mr Parker said.
Prime Minister Jacinda Ardern’s recent meetings with Prime Minister Narendra Modi augured well for building the relationship between the two countries, and this was a good time to “think hard and creatively” to grow trade he added.
He saw potential in New Zealand offering know how in agricultural production and logistics, boosting technological development and modernisation of systems, among other things. NZ Plant & Food Research’s stone fruit projects in the northern Indian state of Himachal Pradesh and of kiwifruit company Zespri, were examples he quoted.
“These projects are mutually beneficial for New Zealand and India not just in growing business but also reducing losses between the farmgate and the consumer,” Mr Parker said.
He said he acknowledged India’s concerns for access to New Zealand’s services sector but stopped short of suggesting any measures to address these concerns.
With just 140 New Zealand companies doing business with India and just 20 of them having a presence on the ground in India, the potential for growth is significant. Mr Parker said high tariffs on the Indian side had stifled growth and that the onus was on India for the FTA with respect to goods.
The India New Zealand Business Council (INZBC) signed a landmark agreement with the ASEAN New Zealand Business Council at an event in Auckland on Friday. Speaking of ASEAN, he said the bloc was New Zealand’s fifth largest trading partner. He extolled the achievements of the Australia ASEAN New Zealand FTA (AANZFTA), the first comprehensive FTA signed by ASEAN, and is a major milestone for New Zealand’s trade negotiations. Since 2010, two-way trade had increased and duties had plummeted, he added.
When successfully completed, these trade agreements would result in all parties following a single set of rules creating a whopping $23trillion market.
Mr Parker said Prime Minister Ardern and New Zealand agreed with Mr Narendra Modi’s speech in Davos in January where he took a stand against rising protectionism among trading nations around the world. “We agree with Prime Minister Modi,” he said.
INZBC signs landmark agreement with ASEAN NZ council
Another milestone achieved at the event was that The India New Zealand Business Council (INZBC) signed an agreement with the ASEAN New Zealand Business Council.
This is a significant development for New Zealand-India trade because both the countries are part of the Regional Comprehensive Economic Agreement (RCEP), which also includes ten countries of the ASEAN (Association of Southeast Asian Nations) grouping.
With a Free Trade Agreement (FTA) between New Zealand and India remaining elusive even a decade after it was first mooted, the two countries are now laying store by this alternative RCEP mechanism to try to achieve what a bilateral FTA might have.
INZBC Chairman Robert Barker and ASEAN-NZBC Chairman Kenneth Leong signed the agreement in the presence of NZ Minister for Trade and Export Growth, David Parker, who was the chief guest for the event, and members of the INZBC board. Joanna Kempkers, New Zealand High Commissioner in India was also present.
“The signing of this MoU is a significant milestone for the ASEAN NZ Business Council, as it highlights the growing importance of multilateral ties between ASEAN, India and New Zealand. We are also pleased to recognise the role that members of both business councils play in helping New Zealand strengthen the relationship with ASEAN and India. We look forward to further collaboration with INZBC by way of joint events and projects”, said Kenneth Leong, Chair of ASEAN-NZBC.
Earlier, INZBC Treasurer and Honorary Indian Consul in Auckland Bhav Dhillon welcomed the well-attended gathering of INZBC members and guests that included Labour MP Priyanca Radhakrishnan.
Almost every company in New Zealand that has something to do with India is member of INZBC and the council had come to earn a reputation as the most active business council in the country with a significant event happening almost every month, Mr Dhillon said.
The council’s ‘India Unplugged’ series of events went beyond just networking. “These are not catch-all events but each one is dedicated to a different aspect of business and have detailed topics like GST, IP and capital repatriation, among others.
The council also has an annual summit dedicated to a subject. Already, summits on IT, agriculture and education have been held. “In 2018, we will have an Aviation Summit,” Mr Dhillon said.
INZBC Executive Member Jo Pennycuick did the honours as MC and Sameer Handa, another Executive Member, proposed a vote of thanks.