Labour to back India FTA but leader Chris Hipkins says ‘this is not the deal Labour would have negotiated’, warns NZ businesses to do own due diligence

Labour is officially supporting the India free trade agreement (FTA), but its leader Chris Hipkins says National has been treating the process in a cavalier manner, and warns businesses to do their own due diligence.

Labour’s show of support on Wednesday follows the Government, minus New Zealand First, on Monday, saying it had agreed, with legal verification now done, the FTA would be signed next week.

In his warning to New Zealand businesses, Hipkins said: “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.”

He said businesses should "proceed at their own risk and do their own due diligence. New Zealand businesses need to go into this with their eyes wide open."

Speaking to reporters alongside trade spokesperson Damien O’Connor, Hipkins said Labour isn’t going to stop the agreement proceeding because of it, but businesses need to be aware.

"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.

The India FTA has been a political scrap between National and Labour. Just last week, Labour accused National of pushing through a rushed, secretive deal but National denied this, saying Labour had ample consultation.

And following the announcement of the signing, Hipkins accused Prime Minister Christopher Luxon of; “playing politics with our free trade agreements" and said signing a FTA if you don’t have majority support in Parliament, “and at this point they don’t,” would be “recklessly irresponsible.”

Labour accuses National of not engaging constructively

When asked how unusual it is to have a situation where the Government has had to approach the Opposition to get this significant deal passed, Hipkins told reporters there has generally been bipartisanship around these deals.

“Unfortunately that hasn’t been on display from the Government until basically right now,” Hipkins claimed. “I think they treated this process cavalierly. They didn’t engage with us when they were doing the negotiations. They didn’t engage with us constructively through the last four months."

We’ve had to drag the information out of them that we’re seeking. The most recent advice we got, particularly the legal advice we were able to review, we only got on Monday,” he said.

“So it has taken us some time to get the information out of them to be able to make that decision.”

National has long maintained the Opposition has been given lots of time to delve into the deal, with Trade Minister Todd McClay previously telling interest.co.nz: "We've had four months of engaging extensively with Labour on this. This includes phone calls, in-person meetings and sessions where officials were able to answer their questions and provide the information they asked for, including official advice.”

Labour's O’Connor said it would be irresponsible to make a judgment without having as much information “as we should have.”

“We weren’t involved in a negotiation, so we didn’t have it. We weren’t privy to the reasons for decisions, and we didn’t have access to that information.”

When the deal was announced, Labour had been seeking some of those details, O’Connor said, and some of that information had only just come through recently.

Asked by a reporter if the delay was due to “not wanting to give the government a win”, Hipkins said no.

'Labour's position on the FTA is settled'

In discussions, Hipkins said the Government has committed to:

• Expanding labour inspectorate at the next budget with funding for at least 14 additional staff in the labour inspectorate focused on migrant worker exploitation and serious immigration offending
• Faster visa changes: Labour said it has commitments both written and verbal to speed up the Variation of Condition for visa holders seeking to change employer
• Modern Slavery Bill progress: The Government will prioritise the Bill, Labour said, ensuring it passes its first reading before the election with a commitment to resourcing Community Law to provide legal advice

“Labour's position on the FTA is settled,” Hipkins said.

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