It’s time to wake this sleeping giant
A recently published report pegs the untapped potential between the New Zealand and India bilateral Free Trade Agreement at $2.1bn (1.0 percent of GDP). This one off boost to NZ exports will benefit multiple sectors, including agricultural as per the white paper published by ANZ Research. It terms India as the ‘sleeping giant’. This is true: since 1990 India has achieved average annual growth of 6.6 per cent. Even so, it is a largely poor country with almost one in three people living below the poverty line (US $ 1 per day). Average USD per-capita incomes (US $1,600 for 2012)are about 1/25th of New Zealand’s.
“NZ companies willing to takethe time to understand the market and build relationships in advance of anFTA will be best placed to profit from improved access when this happens. Regardless of the sector, product or service, to succeed a company must be prepared to commit resources to India market entry - people, time and money. Three to five years is atypical length of time for companies to get serious market traction,” Says Richard White, NZTE Trade Commissioner in New Delhi.
India is changing fast. Currently,of the 1.2 billion people, 30 percent live in urban India. In the next 25 to 30 years, 250 to 300 million peopleare expected to migrate to the cities. The share of GDP generated from rural areas is expected to decline from around 50 percent at presentto 30 percent from 2015, with around 70 percent of jobs created in urban areas.
This transition will result in a burgeoning middle class that is upwardly mobile and hungry. Though price sensitive,considering the demographic advantages and an increasingly liberal economy, India is a huge
potential market for NZ. Certain sectors are a clear and natural match like merchandise trade or swervices trade.In recent years, there has been steady growth in New Zealand’s services trade with India, most notably in tourism and education. India is the most developed relationship NZ has in South Asia and clearly a priority.
The free trade agreement presently under negotiation aims to address a range of barriers and it is likely that in the medium term, the rapidly growing Indian economy with diminishing trade barriers would be the right place for Kiwi businesses to invest time, attention and money. The New Zealand government hopes to work towards India being a core trade, economic and political partner for New Zealand by 2015.
The FTA touches upon key issues like growing merchandise exports to NZD 2 billion per year by 2015, growing services trade by an average of 20 percent a year and improve the bilateral investment framework.
Both countries have much in common, says White, “English language, Commonwealth heritage, cricket, Sir Edmund Hillary - and the fact that persons of Indian Origin now make up one of New Zealand’s largest immigrant ethnic groups,mean that there is a tremendous opportunity for smart businesses to leverage their expertise and enter theIndian market.”
India Facts
As per the World Economic Forumrankings, India currently ranks at63rd in 2012 global competitiveness rankings.According to 2012 IMF projections growth in the Indian economy is set to average 6.3 percent over the next five years.
Since joining the WTO in 1995 India now accounts for around 2 percent of global trade.
By virtue of its size, India is our 15th largest trading partner, with overall merchandise trade between the two conutries worth $1.2bn in 2012.
With 1.2bn mouths to feed, and New Zealand being a food exporter, the natural area to target will be food.
Agriculture constitutes less than one quarter of New Zealand’s exports to India.
A recently published report pegs the untapped potential between the New Zealand and India bilateral Free Trade Agreement at $2.1bn (1.0 percent of GDP). This one off boost to NZ exports will benefit multiple sectors, including agricultural as per the white paper published by ANZ Research. It terms...
A recently published report pegs the untapped potential between the New Zealand and India bilateral Free Trade Agreement at $2.1bn (1.0 percent of GDP). This one off boost to NZ exports will benefit multiple sectors, including agricultural as per the white paper published by ANZ Research. It terms India as the ‘sleeping giant’. This is true: since 1990 India has achieved average annual growth of 6.6 per cent. Even so, it is a largely poor country with almost one in three people living below the poverty line (US $ 1 per day). Average USD per-capita incomes (US $1,600 for 2012)are about 1/25th of New Zealand’s.
“NZ companies willing to takethe time to understand the market and build relationships in advance of anFTA will be best placed to profit from improved access when this happens. Regardless of the sector, product or service, to succeed a company must be prepared to commit resources to India market entry - people, time and money. Three to five years is atypical length of time for companies to get serious market traction,” Says Richard White, NZTE Trade Commissioner in New Delhi.
India is changing fast. Currently,of the 1.2 billion people, 30 percent live in urban India. In the next 25 to 30 years, 250 to 300 million peopleare expected to migrate to the cities. The share of GDP generated from rural areas is expected to decline from around 50 percent at presentto 30 percent from 2015, with around 70 percent of jobs created in urban areas.
This transition will result in a burgeoning middle class that is upwardly mobile and hungry. Though price sensitive,considering the demographic advantages and an increasingly liberal economy, India is a huge
potential market for NZ. Certain sectors are a clear and natural match like merchandise trade or swervices trade.In recent years, there has been steady growth in New Zealand’s services trade with India, most notably in tourism and education. India is the most developed relationship NZ has in South Asia and clearly a priority.
The free trade agreement presently under negotiation aims to address a range of barriers and it is likely that in the medium term, the rapidly growing Indian economy with diminishing trade barriers would be the right place for Kiwi businesses to invest time, attention and money. The New Zealand government hopes to work towards India being a core trade, economic and political partner for New Zealand by 2015.
The FTA touches upon key issues like growing merchandise exports to NZD 2 billion per year by 2015, growing services trade by an average of 20 percent a year and improve the bilateral investment framework.
Both countries have much in common, says White, “English language, Commonwealth heritage, cricket, Sir Edmund Hillary - and the fact that persons of Indian Origin now make up one of New Zealand’s largest immigrant ethnic groups,mean that there is a tremendous opportunity for smart businesses to leverage their expertise and enter theIndian market.”
India Facts
As per the World Economic Forumrankings, India currently ranks at63rd in 2012 global competitiveness rankings.According to 2012 IMF projections growth in the Indian economy is set to average 6.3 percent over the next five years.
Since joining the WTO in 1995 India now accounts for around 2 percent of global trade.
By virtue of its size, India is our 15th largest trading partner, with overall merchandise trade between the two conutries worth $1.2bn in 2012.
With 1.2bn mouths to feed, and New Zealand being a food exporter, the natural area to target will be food.
Agriculture constitutes less than one quarter of New Zealand’s exports to India.
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