India–EFTA trade pact takes effect Oct 1, 2025, with tariff cuts and $100bn investment plan
India’s Trade and Economic Partnership Agreement (TEPA) with the European Free Trade Association (EFTA) took effect on October 1, 2025, two years after the deal was signed, setting in motion tariff reductions and deeper cooperation in trade, investment, services and technology with Iceland, Liechtenstein, Norway and Switzerland.
Prime Minister Narendra Modi said India has built a strong network of Free Trade Agreements in recent years, adding that the country now has FTAs with 38 countries, according to an official release. He said such agreements help Indian manufacturers and businesses sell their products in global markets by reducing or removing tariffs.
India’s trade pacts with Australia and the United Arab Emirates have already increased merchandise trade with those countries, and the agreements have enabled Indian service professionals to develop international work connections, he noted. Union Commerce and Industry Minister Piyush Goyal said the India–EFTA agreement has a long-term economic goal by opening access for Indian exporters to wealthy European markets.
Under the pact, the government says there is a requirement for $100 billion in investment over 15 years and approximately one million direct job opportunities in India. The arrangement is also intended to help Indian companies access advanced machinery, high‑quality materials and technology partnerships from EFTA countries.
On market access, the agreement requires EFTA countries to reduce tariffs on more than 92 percent of their tariff lines, allowing India to export 99.6 percent of its products. India will set tariff reductions for 82.7 percent of its tariff lines, applying to 95.3 percent of EFTA products.
Certain sectors receive protection, including dairy and soya, coal and specific agricultural products. Officials say the pact will benefit a range of Indian industries — from pharmaceuticals and textiles to engineering goods, chemicals, processed food and marine products — and improve access to industrial equipment and components that can upgrade manufacturing processes and competitiveness.
The agreement also facilitates collaboration in IT and professional services and provides for international recognition of qualifications in fields such as nursing, chartered accountancy and architecture. According to the government, the TEPA framework is designed to support India’s export goals of $1 trillion in merchandise and $1 trillion in services by 2030, with stronger ties to advanced economies seen as a pathway to those targets.
Farmers, fishers, small businesses, start-ups, women and young entrepreneurs are expected to gain from improved access to top-tier European markets. States are also set to find new opportunities for products such as Maharashtra grapes, Karnataka coffee, Kerala spices and horticulture from the North-East.
Officials say the India–EFTA TEPA will strengthen trade relations with the bloc, attract foreign investment and promote economic development in the coming years.