Labour Party to back India free trade deal, with reservations

The Labour Party says it will support the India free trade agreement, but has reservations.

New Zealand First had opposed the agreement, which meant National and ACT required the support of Labour to pass legislation allowing the deal.

This means the pathway for the agreement to be enacted has now been cleared for the Government.

The agreement is due to be signed on Monday by Trade Minister Todd McClay, who is set to travel to New Dehli over the weekend. It still needs to pass through Parliament.

National and Labour have been back and forth over advice on the agreement.

Speaking today in Parliament, Labour leader Chris Hipkins reiterated his party’s key concern over a figure within the agreement to promote US$20 billion (NZ$33 billion) in private sector investment to India over 15 years.

“The deal cuts tariffs, and increases market access for New Zealand exporters, and that is very welcome. But the $33 billion investment target is unrealistic and missing it could see benefits clawed back in 15 years.”

“While Todd McClay says it’s all aspirational, India is already setting up oversight and has signalled it will enforce the clawback.

“This is not the deal Labour would have negotiated, but we value our relationship with India and the positive contributions of our Indian communities.”

He said businesses needed to proceed “at their own risk” and with their “eyes wide open”.

Despite this concern, Hipkins said his party’s position on the FTA had now been “settled”.

“Our expectations, both on implementation of the commitments above, and on how this Government conducts itself toward the communities affected, are not negotiable.”

Hipkins said Labour had secured the following commitments from the Government on the FTA:

– Expanded labour inspectorate at the next budget: Funding for at least 14 additional staff in the labour inspectorate focused on migrant worker exploitation and serious and complex immigration offending.

– Faster visa changes: Commitments both written and verbal to speed up the processing of Variation of Condition for those visa holders seeking to change employer.

– Modern Slavery Bill progress: The Government is to prioritise the Modern Slavery Bill, ensuring it passes its first reading before the election, with a commitment to resourcing Community Law to provide legal advice.

‘Credit where it’s due’ – Seymour

In a Facebook post, ACT leader David Seymour said Labour had “done the right [thing] by New Zealanders” by agreeing to support the FTA.

“Labour could have played politics. They could have stonewalled the agreement to deny the Government a ‘win,’ hoping to sign it themselves if they get in after the election in November. That’s exactly what they did with the Trans Pacific Partnership in 2017.”

He said supporting the FTA “really is putting New Zealand first” and “credit where it’s due to Chris Hipkins and the Labour Party”.

“Yes, people have legitimate concerns about immigration, and ACT will address those before we go to the polls. However, the Visas under this agreement amount to six per cent of those issued to Indian nationals, AND we can always change our policy for the other 94%.

“Opposing this deal because of immigration concern is barking up the wrong tree. It’s cutting your nose off to spite your face. It’s putting a handbrake on progress for Kiwi exports, jobs, and wage growth.”

Seymour added New Zealand will now be better able to sell to the “biggest population in the world, that is getting richer every year”.

‘Disgraceful sellout’ – Peters

New Zealand First leader Winston Peters – who has long opposed the FTA in its current format – said Labour and National had “just sealed an FTA that means our country MUST promote $33 billion in just 15 years into a foreign country and NOT New Zealand”.

“This is madness,” Peters said.

“Labour themselves have said this FTA is ‘high risk’ because if we don’t meet that threshold to India’s satisfaction India will CLAW BACK whatever gains New Zealand thinks it has achieved.

“Most people would call that a disgraceful sellout of our country’s future.

“This is an utter unmitigated disaster of an agreement for New Zealand’s future.”

Peters said National and Labour “need to explain” that under the immigration provisions of the FTA, “visa holders can still bring in their family members, in addition to the number of students being able to come to New Zealand being uncapped”.

“Those students are given a guarantee to work while they study which will be taking kiwi jobs away from desperate kiwis.

“We will continue to oppose this deal and fight against this disaster of an agreement.”