Smaller FTAs can complement mega trade pacts. Discuss with reference to the India–New Zealand FTA.

India's ninth FTA, spanning 38 countries with its trade partners, is the India–New Zealand FTA, signed at Bharat Mandapam by Piyush Goyal and Todd McClay after negotiations concluded in a record nine months [1][3]. Small in value, such compact deals are best read as force-multipliers for mega pacts like the India–EU FTA, not substitutes.

How smaller FTAs complement mega pacts

• Speed and low political cost: concluded in nine months — India's fastest — against the multi-year cycles of EU or US negotiations [1].
• Deeper market access: New Zealand eliminated duties on 100% of its 8,284 tariff lines from entry into force, exceeding the roughly 99% coverage of the India–UK CETA [1][3].
• Template-building: services access, investment facilitation and institutional frameworks are field-tested in a low-risk market before being pressed in the India–EU talks [2][3].
• Diversification and resilience: alternative markets cushion labour-intensive MSME sectors — textiles, leather, gems and jewellery, processed foods — against tariff shocks and route disruptions [1].
• Investment and strategic depth: a USD 20 billion New Zealand investment commitment over 15 years, extending India's Oceania footprint after the Australia ECTA [1][3].

Where they fall short

• Scale: goods trade was only about USD 1.3 billion in 2024–25 (from USD 873 million in 2023–24); this cannot offset access to the EU or US [1].
• Sensitive sectors stay excluded, so gains remain concentrated in a few lines.
• Utilisation gap: preferences lapse unused when proving rules of origin costs more than the duty saved — hence the Common Digital Platform for Certificate of Origin and the Export Promotion Mission (₹25,060 crore, FY26–FY31) [4].
• Bandwidth: negotiating capacity diverted from the larger EU and US tracks [3].

Smaller FTAs therefore work as cheap insurance and negotiating apprenticeship rather than as market substitutes. Their payoff depends on administration — publishing FTA-wise utilisation data and training MSMEs on origin rules — so that a rules-based, diversified trade order translates signed pages into shipped goods.