India signed a free trade agreement with a group of four European nations – Switzerland, Norway, Iceland and Liechtenstein – on Sunday, which will see a major investment of around $100 billion for New Delhi over the next 15 years.
The free trade pact between the countries is aimed at reducing tariffs and easing the flow of imports and exports, and was in the making for the last 16 years. 21 rounds of talks were held to finalise the details of the the broad-based Trade and Investment Agreement.
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Lauding the pact, Prime Minister Narendra Modi posted on X, “Delighted by the signing of the India-EFTA Trade & Economic Partnership Agreement. This landmark pact underlines our commitment to boosting economic progress and create opportunities for our youth. The times ahead will bring more prosperity and mutual growth as we strengthen our bonds with EFTA nation.”
The deal was signed between India and the members of the European Free Trade Association, and here are the key factors of the agreement.
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India-EFTA free trade pact: Key factors
The main purpose of the free trade agreement is to boost the trade and investment between India and the four European nations who signed the pact. India expected that this pact will help in boosting exports of pharmaceuticals, garments, chemicals and machinery.
India is also hoping that the free trade agreement will attract investments in automobiles, food processing, railways and the financial sector. India has also invited Swiss transport companies to invest in the Indian Railways.
Further, luxury brands and manufacturers from Switzerland are expected to reap the benefits of this agreement, with watch and clothing brands as well as transport companies expected to see the most investment and export.
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EFTA has committed to promote investments to increase the stock of foreign direct investments by USD 100 billion in India in the next 15 years, and to facilitate the generation of 1 million direct employment in India, through such investments.
EFTA nations will now be allowed to export processed food and beverages, electrical machinery, and other engineering products to India, opening up to a larger market, at significantly low tariffs.
The free trade pact is also expected to accelerate the relations between India and Switzerland – the biggest partner in the EFTA. While many Swiss companies have already entered the Indian market decades ago, this agreement is expected to make the manufactured products cheaper.
(With inputs from ANI)