Summit: How to reap promise of India

New Zealand's two-way trade with India was worth around $2.2 billion in the year to March - about a tenth of that with China. Photo / AP

The Indian negotiator trying to close a free trade agreement with New Zealand has told John Key that the "best is the enemy of the good".

India's lead negotiator on the FTA, Arvind Mehta, made the comments when addressing Key during the India New Zealand Business Council summit in Auckland yesterday.

Mehta, who first started on the FTA negotiations in 2010, came back on board last year to try to close the deal.

"Many negotiators miss the wood for the trees and believe a zero-tariff [deal] is what free-trade agreements are about," Mehta said.

"Trying to take that negotiator on the Indian side to zero means it just goes into rounds and rounds and rounds. So my humble submission, honourable Prime Minister, if you could tell your negotiators that the best is the enemy of the good," he said.

"Here is a man in front of you who's giving you a very good deal, take it and build on it later but don't try to take all of it at one point of time because it may take too long."

Key replied that New Zealand was realistic when negotiating but also wanted to try to get the best deal.

Key said after bilateral talks with Indian President Pranab Mukherjee last month that a free trade agreement was a priority for the Government. However, negotiations kicked off in April 2010 and have gone through 10 rounds without a result.

The Ministry of Foreign Affairs and Trade's Michael Appleton said improving free trade was not just about reducing tariffs.

"It is also about helping to spur further growth in our services trade, to encourage two-way investment and to remove barriers behind the border," he said.

"We are conscious of New Zealand's China experience. Between 2008 and 2016, our two-way trade with China more than doubled, New Zealand's investment in China is steadily increasing ... New Zealand is also increasingly exporting our growing knowledge economy services, such as in design, information technology, film and TV and food safety," he said.

"The New Zealand Government is confident that a similar success story could, under the right conditions, be emulated with India," Appleton said.

New Zealand's two-way trade with India was worth around $2.2 billion in the year to March - about a tenth of that with China.

The focus of yesterday's summit was the agri-tech sector and Appleton said there was significant demand in India for NZ farming expertise.

The chairman of the Agricultural Skill Council of India, Sanjeev Asthana, said there was enormous opportunities for education providers to partner with Indian institutions to train workers.

More than half of Indian workers are employed in the agricultural sector but many needed upskilling.

There was a shortage, for instance, of almost 250,000 tractor drivers and harvest operators, Asthana said.

Alan Pollard, chief executive of Pipfruit New Zealand, said further collaboration between New Zealand and Indian apple industries could bring big benefits.