India and the European Free Trade Association (EFTA) have sealed a $100 billion, 15-year deal, marking the end of nearly 16 years of negotiations. Under the agreement, India will slash import tariffs on industrial goods from Switzerland, Norway, Iceland, and Liechtenstein, in exchange for a $100 billion investment from EFTA over 15 years.
This follows recent trade pacts with Australia and the UAE, with negotiations with Britain in the final stages. PM Modi aims for $1 trillion in annual exports by 2030.
EFTA’s investment is targeted at India’s massive market of 1.4 billion people. The nation will eliminate or reduce customs duties on 95.3% of industrial imports from Switzerland, except for gold. The deal includes provisions for intellectual rights and gender equity.
The agreement needs to be approved by all five parties, and Switzerland is anticipated to do so by 2025. India has decided to lower its 40% bound tariff rate on gold to 39%, but as Swiss imports were valued at $16 billion in the previous fiscal year, this is unlikely to have a major effect.
While the agreement may not immediately address India’s trade gap with EFTA, analysts believe it will attract investment in key sectors like medical devices and clean energy, and facilitate exports using Swiss and Norwegian technologies.
