India inks $100 billion FTA with European nations

India has recently inked a game-changing free trade agreement (FTA) with the European Free Trade Association (EFTA), consisting of Norway, Switzerland, Iceland, and Liechtenstein. The deal, sealed on Sunday, is expected to attract around $100 billion in investments to India, according to Trade Minister Piyush Goyal.

This announcement comes as India has been engaged in FTA negotiations with the United Kingdom for the past two years. The pact with EFTA, after almost 16 years of talks, is seen as a landmark achievement by Prime Minister Narendra Modi, who emphasized its role in boosting economic progress and creating opportunities for the country’s youth.

Under the terms of the agreement, India will eliminate key tariffs on industrial goods from the four EFTA nations. In return, there will be 15-year investments in crucial sectors such as pharmaceuticals, machinery, and manufacturing.

“The times ahead will bring more prosperity and mutual growth as we strengthen our bonds with EFTA nations,” Prime Minister Modi remarked in a statement.

The EFTA echoed the sentiment, stating, “The agreement enhances market access and simplifies customs procedures making it easier for Indian and EFTA businesses to expand their operations in the respective markets.”

However, for the deal to take effect, it must be ratified by India and the four EFTA nations. Switzerland has already expressed its intent to complete this process by next year.

This development adds to India’s recent spree of trade agreements, having signed deals with Australia and the United Arab Emirates in the last two years. As India gears up for general elections this year, there’s a keen interest in its ongoing negotiations with the UK. While the UK’s trade minister, Kemi Badenoch, suggested the possibility of concluding a free trade deal before India’s elections, she acknowledged that it would be a challenging task.

The FTA with EFTA marks a significant step for India in the global economic landscape, promising increased investments and opportunities for growth across various sectors.