Jobs, migration: India trade deal sparks political debate in New Zealand

Political tensions flare in Wellington as New Zealand First opposes the trade deal's immigration concessions, citing concerns over local job security and long-term demographic shifts

The India-New Zealand free trade agreement pairs tariff reductions with strategic labour mobility reforms, expanding work visas and employment rights for Indian professionals and students to address New Zealand’s critical skill shortages.

 

However, immigration-related elements have triggered political opposition within New Zealand, particularly from New Zealand First, a partner in the country’s coalition government.

 

The country is governed by a coalition led by the National Party, with New Zealand First as one of its partners. While National has pushed ahead with the India FTA, New Zealand First has formally opposed it, invoking the coalition’s “agree to disagree” clause and signalling it would vote against the enabling legislation when it reaches Parliament.

 

In a public statement and a post on X, party leader and foreign minister Winston Peters said the agreement was “neither free nor fair” and described it as “a bad deal for New Zealand” that “gives too much away, especially on immigration, and does not get enough in return for New Zealanders, including on dairy”.

 

Keegan Langeveld, leader of Young New Zealand First, the youth wing of the party, said India’s Ministry of Commerce and Industry has highlighted that the FTA puts no cap on the number of Indian students with post-study and working-while-studying visas. “This is much more than the heavily discussed ~1700 work visas for (undefined) ‘skilled migrants’… This deal is bad for New Zealand, but particularly bad for students trying to find work while studying or post-study,” he said on X.

 

A statement by the Indian Commerce Ministry said that students completing STEM bachelor’s or master’s programmes could gain up to three years of post-study work rights, while doctoral scholars could access up to four years, alongside dedicated Temporary Employment Entry visas for 5,000 professionals and 1,000 Work and Holiday Visas.

 

Immigration sensitivities in a changing demographic landscape

 

Immigration is a politically sensitive issue in New Zealand because of rapid demographic change. According to Stats NZ’s National Ethnic Population Projections (2023 base), the Indian-origin population was estimated at around 340,000 in 2023, or about 7 per cent of the total population, and is projected to rise to nearly 14 per cent, or around 900,000 people, by 2048 due to migration and higher fertility rates.

 

Stats NZ’s Estimated Resident Population data shows that as of 30 June 2025, the Indian ethnic population stood at 292,092, making Indians the second-largest Asian ethnic group in the country after the Chinese.

 

Against this backdrop, Peters has warned that the FTA’s creation of a new employment visa specifically for Indian citizens could “generate far greater interest in Indian migration to New Zealand, at a time when we have a very tight labour market”.

 

Existing pathways already broad, critics argue

 

According to Immigration New Zealand, Indian professionals already have multiple routes to work and residence. These include the Skilled Migrant Category Resident Visa and the Green List pathway, which offers straight-to-residence visas for Tier 1 roles such as general practitioners and registered nurses, and work-to-residence options after two years for Tier 2 roles including software engineers and ICT project managers.

 

There is no cap on Green List applications, reflecting acute shortages in sectors such as IT, healthcare, and engineering. Immigration New Zealand also allows post-study work visas of up to three years, as well as Working Holiday and seasonal employment visas for short-term roles.

 

New Zealand First argues that adding FTA-linked mobility commitments risks tying the hands of future governments. “The proposals around the work rights for Indian students… would constrain the ability of future governments to make policy changes in response to changing labour market conditions,” Peters said.

 

Jobs shortage versus unemployment reality

 

The debate is complicated by mixed labour market signals. According to the NZ Herald, New Zealand could face a shortage of at least 250,000 workers by 2045 without policy changes, especially in construction, healthcare, and technology. At the same time, unemployment stood at 5.3 per cent in the September 2025 quarter, highlighting skill mismatches and regional disparities.

 

RNZ News reported that while wages have risen and job applications eased in late 2025, the economy will still need around 47,000 additional workers annually through 2026. The Ministry of Business, Innovation and Employment has also flagged persistent difficulty in filling 20–30 per cent of high-skill roles despite a slowdown in job ads.

 

Coalition tensions and trade trade-offs

 

According to the Waikato Times, critics say the new skilled visa intake could overwhelm the system without meaningful dairy market access in return. BusinessDesk reported that these immigration concessions have sharpened coalition tensions, with New Zealand First prioritising local employment protection over mobility commitments linked to tariff reductions.

 

New Zealand First insists its opposition is not anti-India. “We are deeply committed to the advancement of the India–New Zealand relationship,” Peters said, adding that the party has conveyed its position directly to India’s external affairs minister S Jaishankar.