Content

1. India – New Zealand Free Trade Agreement
2. PESA Mahotsav 2025 & the PESA Act, 1996

India – New Zealand Free Trade Agreement

Why in News ?

• 22 December 2025: Press Information Bureau announced conclusion of the India–New Zealand Free Trade Agreement.
• Concluded within ~9 months (March–December 2025) → among India’s fastest-negotiated FTAs.

Relevance

GS II – International Relations

• Bilateral & Regional Groupings
  • Strengthens India’s engagement with Oceania / Indo-Pacific economic architecture.
  • Enhances India’s role as a rule-shaper in services- and mobility-centric trade agreements.
• India’s Trade Diplomacy Strategy
  • Post-RCEP calibrated FTA model: market access + protection of sensitive sectors.
  • Continuity with India–UK CETA, India–Oman CEPA → coherent IR–economic alignment.

GS III – Indian Economy

• External Sector & Trade Policy
  • 100% duty-free access for Indian exports; addresses tariff escalation barriers.
  • Improves export competitiveness in textiles, engineering, pharma, leather, processed foods.

Strategic Context

• Oceania Pivot: Positions India as a preferred economic partner in the Pacific–Oceania supply chains.
• Trade Diplomacy Continuity: Follows India–Oman CEPA (2025), India–UK CETA (2025), EFTA TEPA (2024).
• Geoeconomic Logic: Diversification away from tariff and non-tariff barriers in traditional markets.

India–New Zealand Economic Snapshot

• New Zealand economy:
  • Per capita income: USD 49,380
  • Imports (2024): USD 47 bn | Exports: USD 42 bn
  • Overseas investment stock (Mar 2025): USD 422.6 bn
• Diaspora leverage:
  • ~300,000 persons of Indian origin (~5% of NZ population).

Bilateral Trade Trends

• Merchandise trade:
  • USD 873 mn (2023–24) → USD 1.3 bn (2024–25) (+49%)
  • Exports: USD 711 mn (+32%)
  • India maintains positive trade balance.
• Long-term trend (2015–25):
  • Exports from India: +130%
  • Imports from NZ: +7.2%
• Services trade:
  • USD 634 mn (2024); +13% YoY
  • Key sectors: IT, travel, business services.

Core Architecture of the FTA

• Tariff liberalisation:
  • 100% duty-free access for Indian exports into NZ (8,284 tariff lines).
  • NZ average applied tariff 2.2% → 0% at EIF.
• India’s tariff offer:
  • Coverage: 70.03% tariff lines
  • Exclusions: 29.97% (dairy, sugar, key agri items, metals, arms).
• Phasing:
  • 30%: Immediate elimination
  • 35.6%: Phased (3/5/7/10 years)
  • 4.37%: Tariff reduction
  • 0.06%: TRQs (apples, kiwi, honey, albumins)

Protection of Sensitive Sectors

• Dairy & core agriculture fully excluded → shields small & marginal farmers.
• TRQs + Minimum Import Price + seasonality prevent import surges.
• Reflects India’s calibrated FTA approach post-RCEP exit.

Sector-wise Gains to India

• Textiles & Apparel:
  • NZ imports from world: USD 1.9 bn
  • Tariffs up to 10% → 0%
• Engineering goods:
  • NZ imports: USD 11 bn
  • India exports (FY25): USD 77.5 bn globally
• Pharmaceuticals:
  • NZ pharma imports: USD 1.4 bn
  • Regulatory annex for faster approvals.
• Leather & Footwear:
  • NZ imports: USD 0.51 bn
  • Zero duty across 181 tariff lines.
• Agri & Processed Food:
  • 1,379 tariff lines (17%)
  • Tea already zero; others peak 5% → 0%.

Services & Mobility: Biggest Structural Win

• Services coverage:
  • Commitments in 118 sectors; MFN in 139 sectors.
• AYUSH & Traditional Medicine Annex (NZ first-ever):
  • Ayurveda, Yoga, Siddha, Unani, Homeopathy.
  • Coexists with Maori health systems → soft power synergy.
• Student mobility (binding commitments):
  • Work: 20 hrs/week
  • Post-study visas:
    • STEM Bachelor: 3 yrs
    • Master’s: up to 3 yrs
    • PhD: up to 4 yrs
• Professional mobility:
  • 5,000 visas (3 yrs) for:
    • AYUSH practitioners, Yoga instructors, Indian chefs, music teachers
    • IT, engineering, healthcare, education, construction.
• Working Holiday Visa:
  • 1,000 Indians/year, multiple entry, 12 months.

Agriculture & Technology Cooperation

• Action Plans: Apple, Kiwi, Honey.
• Interventions:
  • Centres of Excellence
  • Planting material & orchard management
  • Post-harvest & food safety
• Institutional mechanism:
  • Joint Agriculture Productivity Council
• Outcome: Productivity gains without market distortion.

Investment & Regulatory Provisions

• FDI commitment: USD 20 bn over 15 years.
• IPR:
  • NZ to amend laws within 18 months for EU-level GI protection.
• Trade facilitation:
  • Customs clearance: 48 hrs (24 hrs for perishables)
  • Advance rulings, e-documentation.
• Rules of Origin:
  • Anti-circumvention safeguards.

Way Forward

• Ratification after domestic processes; EIF expected 2026.
• Model FTA for:
  • Services-heavy agreements
  • Mobility-centric trade diplomacy
  • Balanced agri protection

Conclusion

• The India–New Zealand FTA marks a qualitative shift from tariff-centric FTAs to mobility, services, technology, and soft-power driven trade architecture, aligning directly with Viksit Bharat @2047 goals.

PESA Mahotsav 2025 & the PESA Act, 1996

Why in News ?

• 23–24 December 2025: PESA Mahotsav – Utsav Lok Sanskriti Ka organised by the Ministry of Panchayati Raj at Visakhapatnam.
• Commemorates the anniversary of the Panchayats (Extension to Scheduled Areas) Act, 1996 (PESA).
• Objective: Awareness, capacity-building, and celebration of community-led governance in Fifth Schedule Areas.

Relevance

GS II – Polity & Governance (CORE AREA)

• Constitutional Framework
  • Article 244 + Fifth Schedule; operationalisation through PESA.
  • Addresses the governance vacuum left by the 73rd Constitutional Amendment.
• Centre–State Relations
  • States bound by PESA’s mandatory features; limits legislative discretion.
• Rights-based Governance
  • Consent-based land acquisition; protection against displacement.

Constitutional & Demographic Context

• ST population: ~8.6% of India’s population.
• Scheduled Areas notified by the President under Article 244 + Fifth Schedule (excluding Assam, Meghalaya, Tripura, Mizoram).
• 73rd Constitutional Amendment (1993):
  • Added Part IX + Eleventh Schedule (29 subjects).
  • Did not automatically apply to Fifth Schedule Areas → governance gap.
• PESA Act, 1996 filled this gap by extending Panchayati Raj to Scheduled Areas with tribal-specific safeguards.

Core Philosophy of PESA

• Gram Sabha-centric governance reflecting tribal customary law.
• Asymmetric decentralisation: stronger village-level powers than general PRIs.
• Legal override: State laws cannot dilute PESA-mandated powers.

Salient Features of the PESA Act 

• Gram Sabha as the fulcrum:
  • Approval of development plans, projects, and programmes.
  • Mandatory consultation/consent for land acquisition, rehabilitation.
• Resource sovereignty:
  • Ownership & management of Minor Forest Produce (MFP).
  • Control over minor water bodies and minor minerals.
• Cultural protection:
  • Safeguards customs, traditions, dispute resolution mechanisms.
• Administrative accountability:
  • Prior recommendation for mining leases.
  • Regulation of money lending.
• Democratic deepening:
  • Prevents alienation of tribal land; strengthens social justice.

Fifth Schedule Coverage:

• States with Scheduled Areas: 10
• Administrative footprint (Total):
  • Villages: 77,564
  • Panchayats: 22,040
  • Blocks: 664
  • Districts: 45
• Rules status:
  • PESA Rules notified: Andhra Pradesh, Chhattisgarh, Gujarat, Himachal Pradesh, Madhya Pradesh, Maharashtra, Rajasthan, Telangana.
  • Draft Rules: Odisha, Jharkhand.

Government Implementation Measures

• Capacity-building (2024–25):
  • 2 rounds of master trainer programmes.
  • >1 lakh elected representatives & officials trained.
• Digital governance:
  • PESA–Gram Panchayat Development Plan Portal (launched Sept 2024).
  • Enables hamlet-wise planning and tracking of:
    • Central & State Finance Commission grants
    • CSS, State schemes, local funds.
• Institutional support:
  • Dedicated PESA Cell within MoPR (legal, social science, finance experts).
• Knowledge localisation:
  • Manuals translated into Telugu, Marathi, Gujarati, Odia + tribal languages (Santhali, Gondi, Bhili, Mundari).
• Centres of Excellence (CoE):
  • Indira Gandhi National Tribal University, Amarkantak:
    • Central share: ₹8.01 crore (5 years).
    • Focus: documentation, training, dispute resolution models, 5 model PESA Gram Sabhas.

Evidence from the Ground: Outcomes & Best Practices

• “PESA in Action” (July 2025):
  • Compilation of 40 success stories across states.

1) Livelihoods & Local Economy (Chhattisgarh – Kanker)

• Village: Khamdhogi (443 population).
• Interventions:
  • Mandatory male–female household representation in Gram Sabha.
  • Committees + technical training.
• Outcomes:
  • Forest produce, fisheries, bamboo-based activities.
  • Shift from subsistence to diversified livelihoods.

2) Customary Law & MFP (Himachal Pradesh – Kinnaur)

• Product: Chilgoza pine nuts.
• Gram Sabha control over harvesting & revenue sharing.
• Equal household distribution + plot-wise allocation.
• Demonstrates custom + statutory harmony under PESA.

3) Minor Minerals & Revenue (Telangana – Godavari Basin)

• Tribal Sand Mining Cooperative:
  • ₹40 lakh annual revenue.
  • Funds channelled to education, health, infrastructure.
• Converts extractive activity into community asset creation.

4) Anti-displacement Shield (Rajasthan – Udaipur)

• Gram Sabha vetoed eviction under wildlife sanctuary notification.
• Used PESA + Rajasthan Panchayati Raj Act, 1999.
• Outcome: Land, livelihood, and cultural security preserved.

Governance Impact Assessment

• Economic: Local value capture from forests, minerals, water.
• Social: Inclusion of women, customary institutions revived.
• Political: Real decentralisation beyond devolution on paper.
• Environmental: Community-led sustainable resource management.

Challenges

• Delayed rule-making in some states.
• Variable administrative compliance with Gram Sabha consent.
• Capacity asymmetry across regions.
• Overlap/conflict with forest & mining departments.

Conclusion

• PESA Mahotsav 2025 symbolises a shift from bureaucratic tribal welfare to constitutional self-rule.
• With data-backed capacity-building, digital planning tools, cultural anchoring, and legal empowerment, PESA is evolving into India’s most radical decentralisation experiment.
• Effective implementation is central to inclusive growth, federal justice, and democratic deepening in Scheduled Areas.