Thematic Spotlight: India Signs Free Trade Agreements With EFTA

India has signed a free trade agreement with the EFTA – a four-country bloc in Europe consisting of Switzerland, Norway, Iceland, and Liechtenstein.1 The first-of-its-kind deal will secure US$100 billion in investment commitments toward India from the four countries over the next 15-years.2 In return, India will grant the group easier access to exports such as processed foods and electronics, as well as the opportunity to capitalise on a market of more than 1.4 billion people in one of the fastest growing major economies in the world.3

For the deal to pass, all five participating countries must agree to the terms, and of the group, Switzerland has the most to gain as the largest commercial partner of India – the two nation’s bilateral trade stood at US$17 billion in FY2022-23.4 While the Swiss parliament has yet to sign the final agreement, reported details reveal that India has proposed to either fully lift or partially remove customs tariffs on 95.3% of industrial imports from Switzerland.5 Furthermore, India has promised improvements to intellectual property rights for the Swiss pharmaceuticals industry – something that has been an issue between the two nations in the past. Overall, the Swiss government is bullish on the prospect of an agreement and will look to finalise the deal by 2025 latest.6

In recent years, India has signed free-trade agreements with multiple other countries. Last year, India signed the Economic Cooperation and Trade Agreement (ECTA) with Australia, and a year prior to that, India signed the Comprehensive Economic Partnership Agreement (CEPA) with the UAE.7 Indian government officials have also reported that a deal with the UK is approaching its final stages.8 Evidently, the EFTA’s free-trade agreement comes as one part of many in Prime Minister Narendra Modi’s plan for India to achieve US$1 trillion in annual exports by 2030.9 The signing also comes ahead of India’s upcoming election season in which Modi will seek a third term as prime minister.

Access India with NDIA.

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