2025 Political Year in Review: Growth, Friction, and the “India Pivot”
By Lions Roar News Political Desk
As the 54th Parliament adjourns for the summer break, 2025 will be remembered as the year the National-ACT-NZ First coalition shifted from “fixing the basics” to a high-stakes “dash for growth.” It was a year defined by breakneck legislative speed, a cooling economy, and a historic diplomatic breakthrough that simultaneously exposed the first major cracks in the government’s unity.
🚀 The Big Win: The India Free Trade Agreement
The undisputed “Christmas Miracle” for the government came on December 22, when Prime Minister Christopher Luxon and Indian PM Narendra Modi finalized a landmark Free Trade Agreement (FTA).1
- The Victory: After decades of failed attempts, the deal eliminates or reduces tariffs on 95% of NZ exports.2 It is a massive win for meat, wool, horticulture, and forestry.3
- The Catch: To secure the deal, NZ made significant concessions on immigration, allowing for 5,000 skilled Indian professionals and 1,000 working holiday places annually.
- The Strategic Shift: This deal signals New Zealand’s definitive “pivot” toward India as a hedge against a cooling Chinese market.
⚖️ The Challenges: Economic Headwinds & Social Tension
While the government touted its legislative efficiency—passing more bills in two years than some MMP governments have in three—the “real world” impact remained a source of political vulnerability.4
- Economic Stagnation: GDP grew by a modest 1.1% to 1.2% in 2025, a figure many economists described as a “perpetual flatline.” Unemployment rose to 5.1%, hitting its highest level since the pandemic.5
- The Treaty Principles Bill: This remained the most polarizing issue of the year. The massive hīkoi to Parliament in late 2024 cast a long shadow over 2025, with David Seymour (ACT) defending the bill against fierce opposition from Te Pāti Māori and the Green Party, leading to some of the most heated debates in the history of the House.
- Budget 2025: Titled “Investment Boost,” the budget focused on tax incentives for business assets but also included controversial cuts, such as halving the government’s KiwiSaver contribution to $260.72 per year to fund infrastructure.
🦁 Leader Performance: Winners & Losers
| Leader | Key 2025 Status |
| Christopher Luxon | The Deal Maker. Finished the year strong with the India FTA, but struggled with personal poll ratings as the “cost of living” crisis lingered. |
| Chris Hipkins | The Resurgent. After a quiet 2024, Hipkins found his voice in 2025, leading Labour back to a polling lead over National in mid-year surveys. |
| Winston Peters | The Rebel. Ended the year by using the “agree to disagree” clause on the India FTA, calling it a “bad deal” for dairy, effectively positioning himself as both inside and outside the government. |
| David Seymour | The Architect. Became Deputy PM in May. He successfully pushed through the RMA repeal and “red tape” cuts, though his Treaty Bill remains a lightning rod for protest. |
