Historically, India has maintained a firm stance on its dairy sector, consistently refusing to open it up in any FTA it has signed to date. This includes even the recently concluded and comprehensive India-UK FTA, where dairy remained off the table. This unwavering position reflects India’s deep commitment to safeguarding the livelihoods of its millions of dairy farmers and the stability of its vital milk production industry, which is a backbone of its rural economy.

While India’s current dairy imports from New Zealand remain minimal, New Delhi has drawn a clear “red line” against allowing raw dairy imports. Although there might be a slim possibility of considering limited imports of specific value-added dairy products, any significant opening of the market to raw milk or bulk dairy commodities is met with strong resistance. This approach aims to protect domestic dairy producers from overwhelming competition.

Beyond dairy, India also expresses reluctance to reduce tariffs on other key New Zealand exports, notably meat and wine. This broader caution signals India’s intent to selectively engage in trade liberalization, prioritizing the protection of its domestic agricultural and food processing industries over full market access for its trading partners. This careful balancing act is keenly observed by international trade analysts.