Trade Minister Todd McClay has rejected NZ First leader Winston Peters' claims that immigration changes tied to the India free trade agreement would unfairly treat Indian nationals. McClay says NZ First is "wrong about this" and should stop "promoting misinformation for the sake of gaining votes," according to RNZ.

The disagreement between the two coalition partners became public on 5 July 2026 over how McClay's India trade deal — signed in New Delhi on 27 April 2026 — would be carried out. The core question is whether the new visa settings Immigration Minister Erica Stanford has approved match what the free trade agreement actually promises, especially around treating Indian citizens fairly. The problem: neither National nor NZ First will release the official briefing document that sits at the centre of the row.

Peters, who also handles Foreign Affairs, publicly read parts of a briefing he said showed officials warning about potential problems with Stanford's changes. He made four specific claims. First, he said Indian nationals would face a labour market test (a check that the role cannot be filled by someone already in the country) that wouldn't apply to citizens from other trade partner countries. Second, he said Indian nationals couldn't apply for a temporary employment visa from inside New Zealand, unlike people from comparable trade countries. Third, he claimed their family members would be treated worse than the families of workers from other trade partner nations. And fourth, he said time spent on a temporary employment visa wouldn't count toward permanent residency — a pathway available to some other trade partners.

McClay's response was straightforward: New Zealand would meet its obligations under the agreement "in all senses." He confirmed that a new visa specifically for India is being created — something no other country will have — but said he couldn't discuss details because ministers were still working through final decisions. He pointed to the deal's uncapped visa channel for specialist workers transferring within the same company, which carries no labour market test, as an example of what the agreement actually offers Indian nationals. He had made this same point publicly in May 2026 on his Facebook page.

Immigration Minister Stanford took a different tack, suggesting Peters had broken normal Cabinet rules by airing the dispute publicly before final decisions were made.

That procedural point matters. In coalition governments, disagreements typically get sorted through Cabinet committees behind closed doors. Taking a contested official briefing into the public arena before a decision is finalised is unusual, and Stanford's comment signals that National sees it as a breach of collective responsibility — the expectation that ministers support each other publicly — rather than as a legitimate policy concern.

Peters' position makes sense in its own context. NZ First draws meaningful support from voters who care about immigration numbers, and the India deal — covering a country already one of New Zealand's largest sources of migrants — is obvious territory for the party to show it's keeping a close eye on things. Whether that position actually stacks up against what the trade agreement actually says is a different question entirely.

The frustration for outside observers is simple: the briefing document no one will release is the whole basis of the argument. Peters says it shows officials flagging compliance risks. McClay says there's no reason to worry. Both are pointing at a piece of paper neither will put on the table. McClay's position is further complicated by his admission that final decisions haven't been made yet — which means the specific settings Peters described may not be what Stanford actually approves.

What is clear is the underlying tension. The NZ-India free trade agreement — signed after years of talks and formalised in a Joint Statement issued in New Delhi on 17 March 2025 — contains specific promises about how Indian nationals seeking work in New Zealand will be treated. If New Zealand imposes conditions on Indian nationals that it doesn't impose on nationals from comparable trade partner countries, the deal could be challenged. McClay's assurance is firm, but until the final visa settings are made public and read alongside the agreement's non-discrimination clauses, the substance of Peters' concerns cannot be independently checked.

McClay also used the moment to announce a National Party policy focusing on seven key markets for future trade deals, keeping the focus on the government's broader trade agenda rather than dwelling on the coalition disagreement.