The free trade agreement between India and the four European nations bloc (EFTA) has come into force, Commerce and Industry Minister Piyush Goyal said on October 1, 2025. This agreement, which was signed in March 2024, is designed to enhance trade, investment, and collaboration between India and the four EFTA nations: Switzerland, Norway, Iceland, and Liechtenstein. TEPA marks India’s first free trade agreement with these developed European countries and features special commitments focused on investment and job creation.
Overview of TEPA
TEPA consists of 14 chapters that cover a range of topics, including goods, services, investment, intellectual property rights, and sustainable development. It provides significant market access, with EFTA agreeing to eliminate tariffs on all non-agricultural products and processed agricultural goods. In return, India has opened up 82.7% of its tariff lines to EFTA, while still protecting sensitive sectors such as pharmaceuticals, medical devices, dairy, and coal. The agreement also emphasizes trade facilitation, rules of origin, sanitary measures, and technical barriers to trade.
Investment and Employment Commitments
EFTA has pledged to boost foreign direct investment (FDI) in India by USD 100 billion over the next 15 years. This investment will focus on long-term productive capital, steering clear of portfolio investments. The goal is to create 1 million direct jobs in India through these investments. To support this, the India-EFTA Desk, which will be established in 2025, will serve as a one-stop shop for facilitating investment and business growth, particularly in sectors like renewable energy, life sciences, engineering, and digital technology.
Market Access for Goods
EFTA provides tariff concessions on 92.2% of tariff lines, which represents a whopping 99.6% of India’s exports to the bloc. Key sectors in India that stand to gain include machinery, textiles, processed foods, chemicals, marine products, coffee, tea, and engineering goods. While sensitive sectors in India are still protected with gradual tariff reductions, Indian exporters are set to enjoy better access to lucrative markets in Switzerland and Norway.
Services and Professional Mobility
TEPA opens doors to over 100 service sub-sectors. It features Mutual Recognition Agreements (MRAs) for professions such as nursing, chartered accountancy, and architecture. This agreement bolsters India’s standing in IT, business services, education, and cultural sectors. It also paves the way for digital service delivery, commercial presence, and the temporary stay of skilled professionals.
Intellectual Property Rights (IPR)
The IPR chapter is in line with WTO TRIPS standards, ensuring strong protection for intellectual property. India’s concerns regarding generic medicines and patent evergreening have been taken into account. This approach fosters innovation while also protecting public health interests.
Sustainable and Inclusive Development
TEPA promotes sustainable growth, environmental protection, and social progress. It encourages transparency, efficiency, and harmonisation of trade procedures. The agreement supports vocational training and technology collaboration to boost India’s young workforce.
Sectoral Opportunities
Agricultural exports like guar gum, basmati rice, and processed foods will benefit from the elimination of tariffs. Marine products, textiles, leather, sports goods, and toys will enjoy zero or reduced duties along with simplified standards. The engineering goods and electronics sectors are poised for growth thanks to enhanced market access and investment inflows. Gems and jewellery will continue to enjoy duty-free access, while chemical and allied products will see tariff removals and streamlined compliance.
India has protected sensitive sectors critical for domestic capacity building and strategic interests. Tariff reductions on these products will be gradual, aligning with Make in India and Production Linked Incentive (PLI) scheme.
