India's global economic policy has gained a new direction. What was not possible with the superpower America for many years has finally been achieved with four influential countries in Europe. India has successfully signed the historic 'Trade and Economic Partnership Agreement' (TEPA) with the 'European Free Trade Association' (EFTA), and this agreement will come into effect from October 1, 2025. This important step will start a new chapter in India's economic journey.
Four advanced countries, Iceland, Liechtenstein, Norway, and Switzerland, are part of EFTA. These countries have taken the initiative to strengthen trade relations with India, and accordingly, both sides signed the TEPA agreement on March 10, 2024. The EFTA group has promised to make direct investments of 100 billion dollars in India over the next 15 years. This is expected to create approximately 1 million direct jobs in India, as expressed by Union Minister Piyush Goyal. The first phase of investment is 50 billion dollars, which will be completed over the next ten years. The remaining investment will be made in the following five years.
Due to this agreement, import duties on many European products coming to India will be gradually reduced. The tax on watches, chocolates, polished diamonds, biscuits, and other luxury items coming from Switzerland will now be zero or minimal. As a result, Indian consumers will now get these products at more affordable prices. This is likely to increase the demand for Swiss products in the domestic market.
Under this agreement, India has opened 82.7 percent of its total import categories to EFTA countries. 95.3 percent of exports from EFTA countries come from these categories, and notably, more than 80 percent of imports are gold. Therefore, it is anticipated that the import of cheap gold in India will stabilize the prices of jewelry to some extent.
Switzerland within EFTA is India's largest trading partner. Swiss companies have immense opportunities for investment in India in sectors like banking, pharmaceuticals, watch industry, and precision machinery. Currently, India has relatively limited trade with the other three countries, but this agreement will expand business relations with them as well. Many companies from these countries are eager to set up production centers in India.
This historic agreement will strengthen India's 'Make in India' and 'Developed India' initiatives on an international level. New employment opportunities, the arrival of new technology, and new doors for industrial expansion will open in the country. This commitment of 100 billion dollars from Europe will be a significant economic support for India.
Overall, the India-EFTA TEPA agreement is not just a trade agreement, but a document that assures India's economic leadership on a global level. What was not possible with a powerful country like the United States has been achieved by European countries, initiating a long-term and committed relationship with India. This agreement is certain to strengthen India's position in the global economy and accelerate economic growth.