28 Jun 2011

Major industries hope for tariff reduction in India trade deal

12:05 pm on 28 June 2011

Two of New Zealand's major export industries say a free trade deal with India would bring a welcome reduction in tariffs for their goods.

Prime Minister John Key is in India to boost negotiations with one of the fastest growing economies in the world.

At present, New Zealand exports little of its major products to India - meat and dairy - in part because of very high tariffs.

Mr Key will meet with Indian Prime Minister Monmohan Singh on Tuesday where the topic of the ongoing trade talks will dominate.

Greg Gent from dairy cooperative Fonterra says the market potential for dairy products in India is massive.

"We have to pay a 60 percent tariff into the market, unless it's for product that the Indians decide they require where they run short, which has happened for the last two years.

"But to see that tariff removed so that we can participate in the growth would be exciting for us."

Peter Beaven from Pipfruit New Zealand says about 11,000 tonnes of apples and pears is exported to India each year, but the tariffs are very high at 50%.

Lower tariffs would give his industry a competitive advantage over other suppliers, into a huge market, he says.

"One of my exporters calculated that if all Indian consumers were able to buy one New Zealand apple daily, we'd actually only have enough to supply their whole market for two or three days of the year - so the potential here for us to grow is extraordinary."

As well as meeting with top-level Indian politicians, Mr Key will lay a wreath in honour of Mohandas Gandhi, who led the famous salt march in 1930 as part of the fight for Indian independence.