Opinion: Our government has set itself a daunting challenge, to deepen and widen New Zealand’s relations with India with the aim of concluding a free-trade agreement with what is the world’s fastest-growing large economy. The admirable objective won’t be easy. India’s protectionist trade instincts are deeply embedded – especially with regard to agricultural products – and stretch back to the country’s independence in 1947, when almost overnight an exhausted Britain left it and Pakistan, born by Caesarean, to their own devices.
Surprisingly soon, these devices created a stable and unified India. Jawaharlal Nehru, the country’s first prime minister, once called it “a bundle of contradictions held together by strong but invisible threads”. A paternal socialist, he created an economy run by bureaucrats in Delhi, all but strangling entrepreneurship.
I was New Zealand’s High Commissioner to India for almost five years in the 1990s, a time when the Congress government at long last began to take the state’s shackles off the entrepreneurial instincts and talents of the Indian business sectors. The results over the past 30 years have been impressive.
However, agriculture is the one sector that the present Bharatiya Janata Party government is apprehensive about opening to the trading world. The livelihoods of tens of millions of families in village India are based on the outputs of their fields and of their cows. And each family has votes in the world’s most vibrant democracy.
It was on this account that, despite sustained efforts, my time in India produced no satisfactory commercial outcomes for New Zealand. My riding instructions had been short and to the point. Nothing airy fairy about human rights or values in common or Kashmir or an aid programme. The objective was quite simply to help NZ companies in their efforts to do more business with India. And especially to ease the restrictions against our agri-exports.
That was 30 years ago. India today has a booming economy. And in 2022, Australia signed an Economic Co-operation and Trade Agreement covering 90% of its exports but not, as yet, dairy. It took years of sustained political and trade diplomacy. Today, the India relationship is one of Australia’s most important and mutually productive – politically, strategically and economically. When I served there, India disdained what it saw as Australia’s middle power pretensions and its subservient relationship with Washington. The relationship was pretty thin. How times have changed.
To achieve an FTA with India will require some years of agreeable foreplay not immediately directed at the ultimate objective. This will need sustained effort and considerable resources. Some will say that a small economy such as ours simply can’t afford the effort required, that China surely offers us more than sufficient trade opportunities. They might cite the Ministry of Foreign Affairs and Trade mantra that was drummed into us as cadets: “Small country, hard choices.”
Sometimes in representing New Zealand abroad, it is all too easy to forget how small and distant we are. I remember at a dinner party in Delhi, the Indian foreign secretary saying New Zealand often punched above its weight. “Well,” said my quintessential Aussie counterpart, “it would be bloody hard for them to punch below it.” So New Zealand representatives abroad have to get up especially early in the morning. No one knows this better than our ubiquitous, veteran Foreign Minister Winston Peters, who has already paid a wide-ranging visit to India. If we fail to achieve an FTA, or something like it, with India, it will not be for want of trying.
Wellington-based Nick Bridge was a diplomat for 35 years, serving mainly in the Indo/Pacific.
