India to Slash Wine Tariffs by Up to 83% Under Landmark Trade Deal With New Zealand

India has agreed to reduce its high tariffs on New Zealand wine imports as part of a new Free Trade Agreement (FTA) signed between the two countries. The agreement, finalized after nine months of negotiations, will see India gradually lower its wine import tariffs from the current 150 percent to either 25 percent or 50 percent over the next ten years, depending on the value of the wine.

The FTA marks a significant step in trade relations between India and New Zealand. According to New Zealand’s Trade and Investment Minister Todd McClay, the deal opens up new opportunities for New Zealand exporters in a market that has previously been difficult to access due to steep import duties. “This once-in-a-generation agreement creates opportunities New Zealand exporters have never had in India,” McClay said. He added that the deal is expected to generate thousands of jobs and billions of dollars in additional exports for New Zealand.

Under the terms of the agreement, tariffs will be eliminated or reduced on 95 percent of New Zealand’s exports to India. More than half of these exports will become tariff-free immediately, with over 80 percent reaching tariff-free status once the agreement is fully implemented. In exchange, India will receive zero-duty market access for all its exports to New Zealand.

Wine, however, will not see immediate tariff elimination. Instead, it will benefit from a phased reduction over a decade. This approach mirrors India’s recent FTA with Australia, under which wine tariffs were cut from 150 percent to 75 percent. India is also in ongoing negotiations with the European Union regarding potential tariff reductions on wine and other products.

Indian Prime Minister Narendra Modi described the agreement as a historic milestone that demonstrates strong political will and a shared ambition to deepen economic ties between the two countries.

Despite the high tariffs, New Zealand’s wine exports to India remain small. Data from New Zealand Winegrowers shows that in the first ten months of 2025, just 22,787 liters of wine were shipped to India, valued at NZD294,329 (USD169,559). In comparison, New Zealand exported about 270 million liters of wine globally during the same period, worth around NZD1.95 billion. This means India accounts for less than 0.1 percent of New Zealand’s total wine export volume and value.

Charlotte Read, General Manager Brand at New Zealand Winegrowers, said there is growing interest among member wineries in expanding into the Indian market. “Presently our exports to India are small, but there is a lot of interest being expressed from our members,” Read said. She noted that the FTA provides certainty for wineries planning their export strategies over the next decade.

The gradual reduction in tariffs is expected to make New Zealand wines more competitive in India’s growing market for imported wines. The agreement also signals India’s willingness to open its market further as it continues trade talks with other major partners.