The India-EFTA Trade and Economic Partnership Agreement (TEPA) celebrated its second anniversary last Tuesday, marking a significant milestone in India’s strategic push to integrate with high-income European economies.
The agreement, which links India with the European Free Trade Association (EFTA)—comprising Iceland, Liechtenstein, Norway, and Switzerland—officially moved into its implementation phase on October 1, 2025.
Strategic Market Access and Tariff Cuts
According to the Ministry of Commerce & Industry, the TEPA provides Indian exporters with unprecedented access to premium markets. Under the deal:
EFTA Commitments: The bloc has removed tariffs on 92.2% of its tariff lines, covering 99.6% of India's current exports. This includes 100% coverage of non-agricultural products.
India’s Commitments: India has offered concessions on 82.7% of its tariff lines. However, the government has maintained "sensitive" protections for domestic sectors such as dairy, soya, coal, and specific agricultural products. The effective duty on gold remains unchanged.
A $100 Billion Investment Roadmap
Union Minister of Commerce and Industry Piyush Goyal highlighted the long-term economic vision of the pact, noting that it creates a pathway for $100 billion in foreign direct investment (FDI) into India over the next 15 years, aimed at generating one million direct jobs.
"This agreement brings together India and a group of advanced European economies in a framework that supports trade, services, and long-term industrial growth," Minister Goyal stated.
Boosting MSMEs and "Make in India"
Prime Minister Narendra Modi lauded the expanding network of India’s trade deals, noting that the country now holds FTAs with 38 partner nations.
"This gives our manufacturers and producers enough diversity and depth to sell our products across many markets," the Prime Minister said. He emphasized that the TEPA is particularly beneficial for MSMEs and start-ups, opening doors for technology transfer and joint ventures with niche European firms.
Key Sectoral Impacts
The agreement is expected to bolster India's export presence in several high-value sectors:
Goods: Pharmaceuticals, textiles, engineering goods, chemicals, and marine products.
Services: A framework for IT, professional services, and knowledge-intensive sectors.
Professional Mobility: The pact enables Mutual Recognition Agreements (MRAs) for professionals such as nurses, chartered accountants, and architects, simplifying the temporary stay of personnel for service delivery.
Agriculture: Regional producers, such as grape farmers in Maharashtra, coffee growers in Karnataka, and spice exporters in Kerala, are expected to see increased demand in European markets.
Driving Toward the 2030 Export Target
The TEPA is a cornerstone of India’s ambitious goal to reach $1 trillion in merchandise exports and $1 trillion in services exports by 2030.
By securing predictable access to advanced machinery and precision components, Indian enterprises are better positioned to upgrade manufacturing standards and integrate into global supply chains.
As the implementation continues, the focus now shifts to localizing these global opportunities across Indian states to ensure inclusive growth for farmers, youth entrepreneurs, and the horticulture sectors of the North Eastern States.
Source: ANI
