India–EFTA Trade Agreement Set to Launch in September 2025: A New Era of Economic Partnership

India is on the verge of unlocking a new chapter in its international trade diplomacy with the scheduled implementation of the India–EFTA Trade and Economic Partnership Agreement (TEPA) in September 2025. Commerce and Industry Minister Piyush Goyal confirmed the timeline during his recent visit to Switzerland, emphasizing the agreement's long-term potential to deepen India’s economic ties with four European nations — Switzerland, Norway, Iceland, and Liechtenstein.

Goyal interacted with CEOs of several Swiss pharmaceutical and life sciences companies who are closely looking at investing in India. (Photo courtesy: @PiyushGoyal) | Business Today

This landmark deal, signed in March 2024, comes after nearly 16 years of negotiations and marks a significant leap in India’s ambitions to forge high-quality trade agreements with developed economies. With a blend of market access, investment commitments, and strategic cooperation, TEPA stands out as a comprehensive pact unlike any India has signed before.

A Timeline to Implementation

Following the signing of the agreement last year, all four EFTA countries have completed their legislative processes. Switzerland — the largest EFTA economy — is in the final phase, with a public objection period set to close by July 10, 2025. Barring any last-minute challenges, the Swiss Parliament is expected to complete procedural formalities post-summer recess, paving the way for the pact to officially come into force in September.

During his discussions in Bern, Minister Goyal expressed confidence that there were “no hurdles left” and emphasized that both sides are fully aligned for a timely implementation. He also held multiple high-level engagements with Swiss industry leaders, reinforcing India’s commitment to the partnership.

Tariff Liberalization and Market Expansion

The agreement introduces a wide array of tariff concessions from both sides. India has agreed to eliminate customs duties on approximately 80 to 85 percent of goods imported from EFTA nations. These include premium exports such as Swiss watches, chocolates, biscuits, cut and polished diamonds, and high-precision machinery. In return, Indian exporters will gain near-complete duty-free access to EFTA markets, with nearly 99 percent of exports eligible for zero or significantly reduced tariffs.

This preferential access could be particularly beneficial for Indian products such as pharmaceuticals, textiles, rice, and engineering goods. However, in a move to protect domestic farmers, both sides have opted to exclude most agricultural and dairy products from liberalization.

Unprecedented Investment Commitment

What truly distinguishes the TEPA from other free trade agreements is the historic investment pledge embedded within it. EFTA countries have committed to investing USD 100 billion into the Indian economy over the next 15 years. This clause is unprecedented in any Indian trade agreement, and it reflects the confidence of these high-income economies in India's long-term growth trajectory.

The investment will target critical sectors such as life sciences, clean energy, cybersecurity, advanced manufacturing, and precision engineering. According to government estimates, this inflow is expected to create over 1 million jobs in India, while also contributing to technology transfer and skill development. The first USD 50 billion is projected to materialize within the initial 10 years of the agreement, with the remainder following in the subsequent five years.

Strategic Sectoral Partnerships

Beyond trade and investment, TEPA lays the foundation for strategic industrial cooperation. Switzerland, known for its technological innovation and precision manufacturing, is expected to collaborate with Indian counterparts in high-value sectors. Goyal, during his visit, encouraged Swiss firms to hold board meetings in India to experience firsthand the advantages of its production-linked incentive (PLI) schemes and rapidly developing infrastructure.

India’s openness to 100 percent foreign direct investment in areas like machinery manufacturing makes it an attractive destination for companies seeking to diversify their global supply chains and reduce overdependence on China. The pact is also likely to strengthen bilateral ties in research, sustainability, and innovation.

A Broader Trade Diplomacy Strategy

The India–EFTA agreement is not an isolated effort. It comes amid a larger diplomatic offensive to bolster India’s position in the global trade system. India is simultaneously pursuing or finalizing free trade agreements with several countries, including the European Union, the United Kingdom, Canada, Chile, Peru, Oman, and New Zealand.

Negotiations with the European Union have advanced rapidly, with eight of the twenty chapters already concluded. Minister Goyal has indicated that both sides are working with urgency to complete the agreement, possibly by the end of 2025. These parallel efforts underscore India’s broader strategy of diversifying its trade partners and integrating more deeply into global value chains.

Conclusion: A Defining Moment for Indian Trade

The India–EFTA TEPA represents a defining moment in India's economic diplomacy. By combining deep tariff liberalization with forward-looking investment guarantees, it sets a new standard for what Indian trade agreements can achieve. It enhances India's access to wealthy, innovation-driven European markets while inviting long-term capital and technology to support its development goals.

As the agreement comes into force this September, it is poised to reshape the trade landscape for both India and the EFTA bloc. For India, this is not just a deal — it is a signal to the world that the country is ready to lead, compete, and collaborate in the global economic order of the 21st century.

(Sources: Money Control, Business Today, News18)