India Will Not Open Dairy Sector to Free Trade: Goyal
India has made it clear that its dairy sector will remain protected and will not be opened up to free trade, Commerce and Industry Minister Piyush Goyal said after India concluded a free trade agreement (FTA) with New Zealand on December 22, 2025. The comment was aimed at calming concerns about sensitive agricultural sectors as the two countries move ahead with the new trade pact.
Dairy Excluded From FTA
Goyal emphasised that India has excluded its dairy products from tariff elimination in the FTA with New Zealand, saying the sector is too important for livelihoods and national food security to be fully liberalised. India’s dairy industry supports millions of small farmers, and government officials have consistently said it will remain shielded from direct competition under trade agreements. In the India-New Zealand pact, dairy and several other agricultural products such as onions, spices and edible oils are not offered free market access, even as most other goods see duty reductions or elimination.
Balancing Trade and Domestic Interests
The free trade deal agreed between New Delhi and Wellington is designed to cut tariffs on the majority of traded goods and promote investment and services cooperation. New Zealand will gain reduced tariffs on many of its exports to India, while Indian products will receive preferential access to the New Zealand market. However, Goyal reiterated that India’s core agricultural sectors, particularly dairy, will not be opened up to full free trade, reflecting a broader strategy of protecting vulnerable domestic industries.
Broader Trade Strategy
Goyal also noted that India is pursuing other trade partnerships, including advanced talks with the United States on a bilateral trade deal, while safeguarding sensitive sectors. He said trade agreements should serve India’s national interests and not force compromises on vital industries. The stance on dairy highlights how India is trying to balance economic liberalisation with protection of key domestic sectors.
