India EFTA Free Trade Deal Comes into Effect October 1

Introduction

India EFTA Free Trade Deal Comes into Effect October 1: On October 1, 2025, the India-EFTA Free Trade Agreement will officially be enforced. This landmark deal marks the first time India has included a legally binding sustainability clause in a trade agreement. Along with boosting bilateral trade, it promises USD 100 billion investment and the creation of 1 million jobs.

Members of EFTA

The European Free Trade Association (EFTA) is composed of Switzerland, Iceland, Norway, and Liechtenstein. The group was established to promote trade and economic integration outside the European Union framework.
Static GK fact: The EFTA was founded in 1960 under the Stockholm Convention.

Agreement Signing

The pact, officially called the Trade and Economic Partnership Agreement (TEPA), was signed on March 10, 2024. It stands out because it combines trade liberalization measures with a long-term investment guarantee, strengthening India’s global economic footprint.

Investment Commitments

The deal ensures a steady flow of USD 100 billion in investment across 15 years. The breakdown includes USD 50 billion in the first decade and another USD 50 billion over the following five years. This is expected to create 1 million direct employment opportunities in India’s industries.
Static GK fact: Switzerland is India’s biggest trading partner within EFTA.

Trade and Market Access

India has provided Switzerland greater market access covering 94.7% of its exports (2018–2023, excluding gold). Key products benefiting include pharmaceuticals, machinery, optical instruments, watches, chocolates, and processed foods. India will also reduce or remove import duties on Swiss watches, chocolates, and cut and polished diamonds.

Sustainability Commitments

A unique aspect of this agreement is the sustainability framework, which is legally binding on both sides. It ensures that trade expansion will not compromise environmental standards, labour rights, and human welfare. The inclusion of such provisions enhances predictability and certainty in bilateral trade relations.

Importance for India

This is the first FTA where India has secured such a large-scale investment pledge. It will improve industrial capacity, attract long-term capital, and support India’s participation in global value chains. Moreover, the pact aligns with the goals of sustainable development and positions India as a responsible global trading partner.

Static GK Tip: India’s first Free Trade Agreement of the modern era was with Sri Lanka in 1998.

Static Usthadian Current Affairs Table

India EFTA Free Trade Deal Comes into Effect October 1: