After more than 16 years of negotiation, the Trade and Economic Partnership Agreement (TEPA) between India and the European Free Trade Association (EFTA) officially came into force on 1st October 2025.
The pact signals a major milestone in India's trade strategy with European economies, opening the flow of goods across both parties as well as bilateral investment opportunities to support economic growth.
Key provisions
EFTA states, which covers Switzerland, Norway, Iceland and Liechtenstein, will liberalise approximately 92.2 percent of their tariff lines for Indian exports. Similarly, India will offer concessions on about 82.7 percent of its tariffs on roughly 95.3 percent of EFTA exports.
The agreement covers trade in goods, services, investment promotion, intellectual property rights, sustainable development and other areas typical of modern comprehensive trade agreements. It also simplifies trade procedures, strengthens regulatory cooperation and gives both sides improved access in goods, services and investment.
Additionally, EFTA states have pledged up to $100 billion of investment in India over 15 years, with a target to create around one million direct jobs in India.
Sectoral opportunities
TEPA opens up many opportunities for both India and the EFTA, with open markets expected to improve competitiveness and reduce compliance costs for a wide range of industries.
Here are some sectors that are positioned to benefit from this trade agreement:
- Indian exporters of chemicals, pharmaceuticals, engineering goods, textiles/leather, processed foods and marine products are well placed to gain from reduced EFTA tariffs and smoother market access.
- For the EFTA side, industries such as precision instruments (e.g., Swiss-made watches), dairy and fish products, luxury foods and high-end machinery gain enhanced access to India’s large and growing consumer and manufacturing base.
- Services and investment flows: The pact supports India's "Make in India" and manufacturing upgrade goals, and positions EFTA companies to participate more deeply in Indian manufacturing, renewable energy, digital transformation and advanced R&D.
What trade and compliance professionals should monitor
To fully leverage the benefits of the pact, trade and compliance teams must monitor several key regulatory and operational developments, including:
- Rules of origin: Given the liberalization of tariffs, firms must ensure that products qualify under the TEPA origin criteria where documentation, supply chain traceability and cumulative origin provisions will matter.
- Tariff schedules and timelines: Because tariff reductions will be rolled out gradually, firms must track which lines are duty-free now, which are slated for future reductions and what transitional safeguards apply.
- Business and investment opportunities: Compliance teams should assess how the agreement may shape future business activities, market presence and regulatory requirements.
- Regulatory harmonization and trade facilitation: The TEPA includes transparency, customs procedures and regulatory cooperation chapters. Companies should prepare for evolving documentation, digital-systems alignment and risk-management frameworks.
- Sensitive sectors and exclusions: Some sectors remain excluded or retain protection, such as certain agricultural lines and gold imports to India. Firms in these areas must not assume full liberalization.
The India-EFTA TEPA offers a significant new avenue for exporters, investors and supply-chain managers on both sides. For Indian firms, the deal provides enhanced access to developed European markets and substantial investment commitments. For EFTA companies, it opens up one of the world's largest and fastest growing consumer and manufacturing economies.
Firms that act quickly and align their internal processes stand to gain a competitive advantage from this deal.