The European Free Trade Association (EFTA) comprises Iceland, Liechtenstein, Norway, and Switzerland.
On Sunday, India and the EFTA, a four-nation European bloc, sealed a free trade agreement. As part of this agreement, New Delhi secured an investment commitment of $100 billion over the next 15 years.
Commerce and Industry Minister Piyush Goyal hailed the signing as a “milestone moment,” marking India’s inaugural modern trade pact with a group of developed nations. He emphasized that, for the first time in such an agreement, EFTA pledged to invest $100 billion over the subsequent 15 years. The agreement is anticipated to take approximately a year to come into effect. The European Free Trade Association (EFTA) is composed of Iceland, Liechtenstein, Norway, and Switzerland. With 14 chapters, the agreement encompasses various aspects such as trade in goods, rules of origin, intellectual property rights (IPRs), trade in services, investment promotion and cooperation, government procurement, as well as technical barriers to trade and trade facilitation.
“EFTA countries gain market access to a major growth market. Our companies strive to diversify their supply chains while rendering them more resilient. India, in return, will attract more foreign investment from EFTA, which will ultimately translate into an increase in good jobs…All in all, the TEPA will allow us to make better use of our economic potential and create additional opportunities for both India and the EFTA States,” Federal Councillor Guy Parmelin, speaking on behalf of the EFTA member states, said.
Free trade agreements involve significant reductions or eliminations of customs duties on a wide range of goods traded between two partners, along with the relaxation of regulations to facilitate trade in services and investments.
Negotiations between India and EFTA for the Trade and Economic Partnership Agreement (TEPA) officially commenced in January 2008. Thirteen rounds of talks took place until November 2013 when negotiations were paused. Negotiations resumed in October 2023, and both parties swiftly concluded the agreement.
EFTA member nations are distinct from the European Union (EU). EFTA operates as an intergovernmental organization aimed at fostering and enhancing free trade. It was established as an alternative for states that opted not to join the European community.
