The India–European Free Trade Association (EFTA) Trade and Economic Partnership Agreement (TEPA) will officially come into force on 1 October 2025, following its signing in New Delhi on 10 March 2024. This landmark agreement is India’s first Free Trade Agreement (FTA) with four developed European countries—Switzerland, Norway, Iceland, and Liechtenstein—and stands out as the first FTA signed by India to include binding commitments on investment and job creation.
TEPA is comprehensive in scope, spanning 14 chapters covering market access for goods and services, trade facilitation, rules of origin, intellectual property rights, sustainable development, and investment promotion. Unlike earlier trade pacts, TEPA is a forward-looking, investment-driven partnership designed to deepen economic ties and create opportunities across both goods and services.
A defining feature of TEPA is its ambitious investment and employment pledge. The EFTA bloc has committed to increasing foreign direct investment in India by USD 100 billion over 15 years—USD 50 billion within the first decade and an additional USD 50 billion in the following five years. These inflows are projected to generate 1 million direct jobs in India, targeting sectors such as precision engineering, renewable energy, health sciences, and advanced manufacturing. Importantly, this commitment excludes foreign portfolio investment, ensuring long-term capital for building productive capacity.
On the goods front, EFTA has offered tariff concessions on 92.2% of tariff lines, covering 99.6% of India’s exports, including 100% of non-agricultural products and processed agricultural goods. India, in turn, has extended concessions on 82.7% of tariff lines, representing 95.3% of EFTA exports—of which gold accounts for over 80%. Sensitive Indian sectors such as dairy, coal, medical devices, and processed foods have been safeguarded through phased tariff reductions. This ensures that while market access is expanded, domestic industries under initiatives like Make in India and PLI remain protected.
In the services sector, which contributes more than half of India’s GVA, TEPA brings significant gains. India has offered commitments in 105 sub-sectors, while securing wider access from EFTA partners—128 from Switzerland, 114 from Norway, 107 from Liechtenstein, and 110 from Iceland. TEPA enables digital delivery of services (Mode 1), commercial presence (Mode 3), and temporary mobility of professionals (Mode 4). Importantly, provisions for Mutual Recognition Agreements (MRAs) will open new avenues for Indian professionals in nursing, accountancy, and architecture.
The pact also places emphasis on sustainability and inclusivity, with dedicated chapters addressing environmental protection, transparent trade practices, and inclusive growth. Intellectual Property Rights (IPR) are aligned with TRIPS standards, balancing Switzerland’s high IPR benchmarks with India’s interests in generic medicines by addressing concerns of patent evergreening.
Agriculture and allied sectors stand to gain significantly. Products such as basmati rice, guar gum, fresh fruits, vegetables, cashews, and millets will benefit from tariff elimination, improving India’s competitiveness against traditional suppliers. Similarly, marine products, textiles, gems and jewellery, chemicals, plastics, electronics, and engineering goods are positioned to gain from improved access and reduced compliance barriers. In addition, India’s coffee and tea exporters will now enjoy duty-free access in premium EFTA markets like Switzerland and Norway, boosting high-value exports.
To facilitate investment, a dedicated India–EFTA Desk has been operational since February 2025, functioning as a single-window mechanism for EFTA businesses. It will focus on promoting joint ventures, SME partnerships, technology collaboration, and regulatory facilitation in high-growth areas such as renewable energy, life sciences, digital transformation, and R&D.
By committing to investments, trade facilitation, and sustainable development, TEPA goes far beyond a conventional trade agreement. It positions India as a trusted partner in Europe while reinforcing Atmanirbhar Bharat. As TEPA takes effect from October 2025, it will not only expand trade but also anchor long-term economic collaboration, making it a model agreement for India’s future FTAs.
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