India has embarked on a decisive step forward in international trade by entering into a historical agreement with the European Free Trade Association (EFTA), which includes Iceland, Liechtenstein, Norway, and Switzerland. This move aims to escalate trade and investment efforts, fostering an environment where the economy thrives and consumers enjoy greater access to a variety of high-quality goods. In an ambitious pledge, EFTA has committed an investment of $100 billion in India with the hopes of creating one million jobs over the next 15 years. Highlighting the investment targets, Norway’s Minister of Trade and Industry, Jan Christian Vestre, expressed confidence in achieving these goals through coordinated efforts to mitigate challenges and obstacles, and by placing strategic emphasis on the ease of doing business.
Under the trade agreement, India enjoys the phased reduction of custom duties which spells good news for Indian consumers. High-end Swiss products such as watches, chocolates, biscuits, and clocks will become more affordable due to the gradual drop in duties. The treaty provides for concession rates on a plethora of imported items from EFTA countries, including seafood, fruits, beverages like coffee and wine, and a variety of other food and consumer goods. Notably, wines under a specified price point will see a reduction in duties from 150% to 50%, spanned over a decade. However, the agreement does not modify the effective tariff on gold which remains at 15 percent.
This pact, commended by Prime Minister Narendra Modi as a ‘Watershed moment’, symbolizes the commitment to propagate fair trade. It opens new avenues in digital trade, banking and financial services, and also in sectors like transport, logistics, biotechnology, and clean energy among others. It reflects the culmination of negotiations that spanned over 16 years, making a strong statement on India’s engagement with global trade dynamics and setting potential precedents for future trade deals, including those with countries like those in the EU. The India-EFTA agreement ushers in an era of strengthened bilateral relations, providing significant economic benefits and easier access to high-quality products for the Indian populace.