India is set to ink a historic free trade agreement (FTA) with the European Free Trade Association (EFTA) group of nations, comprising Iceland, Liechtenstein, Norway, and Switzerland on Sunday.
The formal signing ceremony, scheduled for Sunday morning in New Delhi, is anticipated to be attended by senior officials from both India and the four EFTA countries, according to sources familiar with the development who spoke on condition of anonymity.
Negotiations on the India-EFTA deal, which commenced in January 2008, had been stagnant since 2013 until being revitalized last year. Described as a "win-win deal" by insiders privy to the negotiations, the agreement is touted to address sensitivities on both sides, marking the first FTA with any European entities.
"The Trade and Economic Partnership Agreement (TEPA) between India and EFTA covers wide-ranging matters such as trade in goods and services, rules of origin, intellectual property rights (IPR), investment promotion, trade facilitation, and sustainable development," a source elaborated.
TEPA is expected to play a pivotal role in rectifying India's trade deficit with the EFTA states, which stood at over $18.57 billion in 2023, primarily driven by gold imports. In the same year, India's exports to the EFTA region amounted to $1.87 billion, while imports from the bloc exceeded $20.45 billion, with Switzerland alone accounting for $19.65 billion, primarily due to gold purchases.
To address concerns over gold imports, India may consider implementing a quota-based concessional duty regime for EFTA states, akin to an existing arrangement with the United Arab Emirates (UAE).
India's key imports from the EFTA nations include gold, silver, coal, pharmaceuticals, vegetable oil, dairy machinery, medical items, crude, and scientific equipment. Conversely, it exports chemicals, iron and steel, gold, precious stones, yarns, sports goods, glassware, and bulk drugs to these countries.
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