India-EFTA Trade and Economic Partnership Agreement (TEPA)

• 20 Mar 2024

The India-EFTA TEPA is the latest in India’s recent Free Trade Agreements (FTAs) which ventures into some uncharted territory.

Key Points

• TEPA sets out a target of a $100 billion investment into India from EFTA countries and consequent one million jobs over a 15-year period.
• It also provides India the ability to withdraw its tariff concessions if such expected investment is not achieved. If India is not satisfied, it can pull back its tariff concessions in a proportionate manner after 18 years.
• India is mandated to eliminate tariff on most products within seven to 10 years.
• With regard to India’s exports to EFTA, there will be no material impact since most products face very low or zero tariffs for nations which have the Most Favoured Nation (MFN) status in EFTA countries.
• On services, both India and the EFTA members have committed to liberalisation across a wide range of sectors.
• The TEPA’s chapter on Trade and Sustainable Development (TSD), comprising commitments on environment and labour aspects, represents a first for India in any FTA.