India&rsquo;s free trade agreement with the European Free Trade Association (EFTA) officially comes into force today, marking a watershed moment in the country&rsquo;s trade diplomacy. The landmark Trade and Economic Partnership Agreement (TEPA), signed in March last year in New Delhi, is set to channel $100 billion in foreign direct investment (FDI) and create 1 million jobs in India over the next 15 years.
The pact, covering goods, services, investment and sustainability, was described by the Ministry of Commerce as a &ldquo;modern and ambitious agreement&rdquo; that extends far beyond tariff concessions. Under the terms of the deal, EFTA states &mdash; Switzerland, Norway, Iceland and Liechtenstein &mdash; will bring in $50 billion FDI within the first decade and another $50 billion in the following five years, with a focus on building productive capacity rather than portfolio flows.
<h3 data-start="1155" data-end="1188">Market Access &amp; Trade Boost</h3>
TEPA unlocks duty-free access to 92.2% of EFTA&rsquo;s tariff lines, covering almost 99.6% of India&rsquo;s exports, including processed food, basmati rice, guar gum, grapes, marine products, textiles, chemicals, and machinery. India, in return, has liberalised 82.7% of its tariff lines, accounting for 95.3% of EFTA&rsquo;s exports. Sensitive sectors such as dairy, soya, pharmaceuticals, medical devices, coal and gold remain protected under the current structure.
Indian exporters are expected to gain big in engineering, electronics, marine products, textiles, and gems &amp; jewellery, while consumers at home will soon get Swiss watches, chocolates, clocks and biscuits at lower prices, as India phases out duties over the next 10 years.
<h3 data-start="1946" data-end="1986">Services, Skills &amp; Technology Edge</h3>
On services, India has opened 105 sub-sectors, while EFTA nations have extended commitments across 114&ndash;128 sectors, ranging from IT and business services to education, culture, and audio-visual industries. The pact also enables Mutual Recognition Agreements (MRAs) for professionals like nurses, chartered accountants, and architects, allowing smoother mobility of skilled talent.
Commerce officials stressed TEPA&rsquo;s role in strengthening India&rsquo;s technology ecosystem, with cooperation expected in renewable energy, health sciences, precision engineering and R&amp;D. An IPR framework at WTO-TRIPS level will further protect innovation and encourage joint ventures in cutting-edge sectors.
<h3 data-start="2702" data-end="2751">Shaping the Next Phase of India-Europe Ties</h3>
The EFTA bloc is India&rsquo;s third major trade partner grouping in Europe, after its recent FTA with the UK and ongoing negotiations with the European Union. Officials noted that while Switzerland remains India&rsquo;s biggest partner within EFTA, the pact could open doors for stronger trade flows with Norway, Iceland and Liechtenstein, currently modest in value.
The Commerce Ministry said TEPA would be a &ldquo;jobs-first agreement&rdquo;, designed to boost manufacturing, services and technology-driven industries for India&rsquo;s young workforce.

India-EFTA Trade Pact Unlocks $100 bn FDI

Historic TEPA deal promises 1 million jobs, tariff cuts, and stronger tech collaboration

India-EFTA Trade Pact Unlocks $100 bn FDI

Historic TEPA deal promises 1 million jobs, tariff cuts, and stronger tech collaboration

October 1, 2025 | 11:49 IST