NEW DELHI: India and the European Free Trade Association (EFTA) on Sunday bolstered their economic ties by signing of a Trade and Economic Partnership Agreement (TEPA).
This agreement marks the first Free Trade Agreement (FTA) signed by India with four developed nations within the EFTA bloc, including Switzerland, Iceland, Norway, and Liechtenstein.
Commerce Minister Piyush Goyal hailed TEPA as a modern and ambitious pact which includes a binding commitment of $100 billion in investments and the creation of 1 million direct jobs in India over the next 15 years. “The agreement will give a boost to Make in India and provide opportunities to young & talented workforce. The FTA will provide a window to Indian exporters to access large European and global markets,” Goyal said.
Comprising 14 comprehensive chapters touching upon various aspects of trade, the TEPA focuses on crucial elements such as market access, rules of origin, investment promotion, intellectual property rights, and sustainable development. Key highlights of the agreement include EFTA offering access to 92.2% of its tariff lines, covering 99.6% of India’s exports, while India reciprocates by opening up 82.7% of its tariff lines, encompassing 95.3% of EFTA exports.
The EFTA’s market access offer covers 100% of non-agri products and tariff concession on Processed Agricultural Products (PAP). “India is offering 82.7% of its tariff lines which covers 95.3% of EFTA exports of which more than 80% import is Gold. The effective duty on Gold remains untouched.Sensitivity related to PLI in sectors such as pharma, medical devices & processed food etc. have been taken while extending offers. Sectors such as dairy, soya, coal and sensitive agricultural products are kept in exclusion list,” the commerce ministry said.
India has offered 105 sub-sectors to the EFTA and secured commitments in 128 sub-sectors from Switzerland, 114 from Norway, 107 from Liechtenstein, and 110 from Iceland. TEPA is set to drive the export of services, focusing on sectors where India holds key strengths and interests such as IT services, business services, cultural endeavors, sports and recreation services, education services, and audio-visual offerings. TEPA also has provisions for Mutual Recognition Agreements in Professional Services like nursing, chartered accountants, architects, etc.
Swiss watches, chocolates at lower prices
As a result of the Trade and Economic Partnership Agreement (TEPA) between India and the European Free Trade Association (EFTA) nations, Indians can anticipate reduced prices on renowned Swiss watches and chocolates due to the duty concessions negotiated by New Delhi.
As per the agreement terms, India will gradually eliminate basic customs duties on Swiss chocolates and wrist as well as pocket watches over a seven-year span. Currently, India imposes a 30% import duty on chocolates and 20% on various Swiss watch models, which will be phased out to zero under the pact. In addition, India has also extended concessions on Swiss wines based on their CIF (cost, insurance and freight) values. Wines with CIF between $5 and $15 will receive immediate benefits.
Effective duty on gold remains untouched
India is offering 82.7% of its tariff lines that covers 95.3% of EFTA exports of which more than 80% import is gold. The effective duty on gold remains untouched.Sensitivity related to PLI in sectors such as pharma, medical devices & processed food etc. have been taken while extending offers. Sectors such as dairy, soya, coal and sensitive agricultural products are kept in exclusion list.