India-EFTA Trade and Economic Partnership Agreement (TEPA)

India-EFTA Trade and Economic Partnership Agreement (TEPA)

  • Context: 

  • The Trade and Economic Partnership Agreement (TEPA) between India and the European Free Trade Association (EFTA) countries, signed on March 10, 2024, came into force on October 1, 2025.  

  • This is India's first Free Trade Agreement (FTA) with a bloc of four developed European nations.  

  • What is EFTA? 

  • The European Free Trade Association (EFTA) is an intergovernmental organization established in 1960 to promote free trade and economic integration among its members 

  • Member Countries:  

  • Iceland 

  • Liechtenstein  

  • Norway 

  • Switzerland 

  • It is one of the three major economic blocs in Europe. 

  • Other two are the European Union (EU) and the United Kingdom (UK) 

  • Key Features of TEPA: 

  •  Investment and Job Creation: 

  • For the first time in any Indian FTA, TEPA includes a legally binding commitment from EFTA countries to invest USD 100 billion in India over the next 15 years.  

  • The agreement also aims to create 1 million direct jobs in India during the same period.  

  • Market Access and Tariff Concessions: 

  • EFTA's Offer:  

  • Provides tariff concessions on 92.2% of its tariff lines, which covers 99.6% of India's exports.  

  • This includes all non-agricultural goods and processed agricultural products. 

  • India's Offer:  

  • India has extended access on 82.7% of its tariff lines, accounting for 95.3% of EFTA's exports. 

  • Safeguards for India:  

  • Key sensitive sectors like dairy, soya, coal, and select agricultural products have been kept on the exclusion list to protect domestic industries.  

  • Services Sector: 

  • The pact significantly boosts trade in services.  

  • India has made commitments in 105 sub-sectors, while EFTA has offered access in up to 128 sub-sectors, including key areas like IT, business services, and education. 

  • A key provision is the inclusion of Mutual Recognition Agreements (MRAs) for professionals in fields such as nursing, chartered accountancy, and architecture, which will ease professional mobility.  

  • Intellectual Property Rights (IPR): 

  • The agreement reaffirms commitments under the TRIPS agreement and ensures a high level of protection. 

  • It preserves India's policy space and flexibility on public health issues. 

  • This includes safeguards against patent evergreening to protect affordable access to medicines.