New Zealand’s Foreign Minister, Winston Peters, has publicly slammed the free trade deal with India, saying both countries still don’t see eye to eye on a key $20 billion investment clause. Even after Indian Prime Minister Modi’s recent visit to New Zealand, this major issue remains unresolved. He didn’t hold back, calling the situation “unbelievable” and flat-out “embarrassing.”
According to reports on July 12, Peters made these comments after wrapping up a week-long trip to Singapore and Japan. Interestingly, his schedule meant he “perfectly missed” PM Modi, who was visiting New Zealand at the same time. Many see this as a sign of disagreement within New Zealand’s ruling coalition over the India trade deal.
On July 11, in Auckland, New Zealand, Indian Prime Minister Modi (left) and New Zealand Prime Minister Christopher Luxon shared the stage at a community welcome event at Spark Arena.
The big debate is over one part of the agreement: a clause that says New Zealand will push for $20 billion in investments from its companies into India over 15 years. India sees this as a “firm promise” from New Zealand. But the New Zealand government insists it’s just about “promoting” investments to hit that target, not a guaranteed commitment from the government itself.
Reports say Chapter 9 of the deal, released by New Zealand’s Ministry of Foreign Affairs and Trade, uses the word “promote” instead of “commit.” So, from New Zealand’s view, that $20 billion is more of a hopeful goal, not a must-do obligation.
But during his visit to Auckland last week, Modi mentioned three times in public that this $20 billion is a “firm commitment” from New Zealand. That sparked a lot of buzz in New Zealand, making it clear the two sides read the same line very differently.
Peters didn’t hide his frustration. He said it’s hard to believe that after all the talks, signing the deal, and even Modi’s visit ending, the two countries still can’t agree on what the agreement actually means.
“It’s 2026. He’s come and gone, and we still don’t know what’s really going on,” he said.
“This is just embarrassing,” Peters added.
Reports note that Peters has long been one of the harshest critics of this investment clause. He thinks that wording that’s open to different interpretations is a design flaw, and he’s always had reservations about the whole deal.
In fact, this free trade agreement has been a big focus for New Zealand’s government. PM Christopher Luxon hopes it will open up India as one of the world’s fastest-growing major economies, reducing New Zealand’s reliance on traditional export markets.
According to what New Zealand’s government has shared, India will gradually remove tariffs on over 99% of New Zealand exports, covering dairy, meat, horticulture, timber, and more. In return, New Zealand will remove all tariffs on Indian imports and expand cooperation in services, education, and the digital economy.
The New Zealand government expects the deal to save its exporters hundreds of millions of New Zealand dollars in tariffs each year and create more trade and investment chances. During his visit, Modi called the agreement a major milestone for both countries, saying it would boost economic ties to a new level.
But with this public disagreement over the $20 billion investment clause, the freshly signed deal is already facing questions.
Critics argue that if the core of the deal can be understood so differently, more disputes are likely down the road. Supporters, however, say the investment target is just a guideline and shouldn’t ruin the whole agreement.
The New Zealand Herald points out that Peters’ public criticism shows the ruling coalition isn’t all on the same page about this deal. While the government sees it as one of the biggest trade wins in years, debates over the investment promise, the wording, and how to move forward are probably going to keep going for a while.