NZ First leader Winston Peters has sharply condemned Labour’s decision to support the India free trade agreement, calling it “madness” and a “disgraceful sellout” that could undermine New Zealand’s long-term economic interests.
The Labour Party has confirmed it will now back the deal, giving National and ACT the numbers needed to push the agreement through Parliament. The move clears the way for the controversial trade pact.
The agreement, announced in December, was set to be formally signed in New Delhi on Monday but still needed Labour’s backing to pass Parliament after firm opposition from NZ First.
Labour leader Chris Hipkins said the party had agreed to support the deal after reviewing the text and legal advice but admitted serious concerns remained. In particular, he criticised a provision linking up to US$20 billion in New Zealand private sector investment into India over 15 years, describing it as “very unrealistic” and “almost impossible” to achieve.
“India have reserved the right to claw back the concessions they’ve granted… in the event that New Zealand businesses don’t invest $20 billion US in India,” he said.
“We’re not going to stop the agreement proceeding because of it, but businesses need to be aware that that is a risk to them.”
NZ First leader Winston Peters, however, escalated his opposition, arguing the deal exposes New Zealand to unnecessary economic risk and weakens the country’s negotiating position.
In a social media post, Peters labelled the free trade deal “an utter unmitigated disaster.”
“It is clear now that NZ First is the only party that cares about our own country and the only party that puts New Zealand and New Zealanders first,” Peters said.
“We will continue to oppose this deal and fight against this disaster of an agreement.”
With Labour now on board, the free trade deal is expected to proceed, but the controversy surrounding it is likely to continue, particularly over concerns about investment obligations, reciprocity, and the broader impact on New Zealand’s economic sovereignty.