The free trade agreement between India and the European Free Trade Association (EFTA) will come into force from October 1, commerce and industry minister Piyush Goyal said Saturday. 

India and the four-nation EFTA had signed the FTA—officially named Trade and Economic Partnership Agreement (TEPA) —in March last year. 

EFTA comprises Switzerland, Norway, Iceland and Lichtenstein.

“All the four countries have ratified the FTA. The documents have been launched with a repository, which is Norway, and the TEPA will come into effect from October 1,” Goyal said at a Assocham event in Mumbai. Switzerland was the last country in the grouping to have completed the process of ratification. 

The national parliaments of Iceland, Liechtenstein and Norway had already completed the process. In India ratification of international agreements is done by the Cabinet.

$100 billion investment promise, 1 million jobs in 15 years

The TEPA is different from traditional trade agreements, as in return for access to Indian markets, the four-nation group has promised direct investments of $100 billion in India over the next 15 years that will facilitate creation of one million direct jobs.

In February this year a large business delegation from EFTA countries visited India to look for investment opportunities. A delegation from India also made a return visit to Switzerland in June to explore tie-ups.

Tariff coverage, gold imports, and trade deficit

The biggest trading partner of India in the group, Switzerland, already has zero tariffs for all manufactured products for all countries. It could not offer anything India-specific in the manufactured goods category and had sensitivities in the agriculture sector. Other economies of the association already have lower tariffs and even their populations are small.

EFTA is offering concessions in 92.2% of its tariff lines, which covers 99.6% of India’s exports. The EFTA’s market access offer covers 100% of non-agri products and tariff concession on processed agricultural products (PAP).

As part of the deal India is offering 82.7% of its tariff lines, which covers 95.3% of EFTA exports, of which more than 80% import is gold. The effective duty on gold remains untouched. Sectors such as dairy, soy, coal and sensitive agricultural products are kept in the exclusion list.  

India runs a massive trade deficit with EFTA. In 2024-25 India’s exports to the group stood at $1.96 billion, while imports were $22.4 billion. A large part of the deficit is due to imports of gold from Switzerland. Last financial year India imported $18.1 billion dollars of gold from Switzerland.