Labour cautions Govt not to sign India–NZ FTA yet, citing contradictions

The Labour Party has cautioned the Government against proceeding with a free trade agreement (FTA) with India before securing backing in Parliament, a step required for the deal to take effect.

The caution comes as details also emerged about a potential visit by Indian Prime Minister Narendra Modi to New Zealand.

The expected visit follows discussions between Trade Minister Todd McClay and his Indian counterpart, Piyush Goyal, on the sidelines of a World Trade Organization ministerial conference in Cameroon on Sunday. Talks focused on trade ties and preparations for Modi’s visit.

"Expressing high enthusiasm for this visit, New Zealand confirmed that a substantial list of deliverables are currently being finalised by both sides for this visit. To further strengthen economic ties, New Zealand will be hosting a high-level business delegation during the Prime Minister Modi’s visit," a Ministry of Commerce & Industry press statement said on 29 March.

At present, the Government does not have the numbers to ratify the agreement. NZ First has withdrawn its support, and Labour has yet to make a commitment. Labour leader Chris Hipkins said on Monday the Government “certainly cannot take our support for granted.”

Labour’s concerns have focused on discrepancies between the Government’s public assurances and the full, confidential text of the FTA. Hipkins confirmed he wrote to McClay outlining these issues.

“We set out... in even more detail what the concerns were because the letter I received from Todd McClay did not address those,” Hipkins said, as quoted by Herald.

“We’ve gone back and quoted specific sections from the text of the agreement that we have seen... that contradict the public statements that the Government has been making. Certainly the text of the agreement does conflict with what they have been saying publicly about it," Herald quoted.

“Signing a free trade agreement if you don’t have the majority support in Parliament, and at this point they don’t, would be recklessly irresponsible,” Herald quoted Hipkins as saying.

While nothing prevents McClay from signing the FTA before Labour’s support is secured, doing so could leave the agreement vulnerable if the opposition party withdraws backing before parliamentary ratification.

Labour is navigating a delicate position, where the party may support the deal but is negotiating terms carefully before making a final decision.

The Government is moving ahead in an attempt to formalise the deal, previously expected to be signed in the first half of the year.