India-EFTA Trade Deal: $100 Billion Investment and 1 Million Jobs
India has secured a landmark trade agreement with four European nations, promising $100 billion in investments and the creation of one million direct jobs over 15 years. The India-European Free Trade Association (EFTA) Trade and Economic Partnership Agreement (TEPA) came into force on October 1, marking a significant shift in India’s trade policy.
Key Takeaways
- $100 Billion FDI: EFTA states pledge $50 billion in the first decade and another $50 billion in the subsequent five years.
- 1 Million Jobs: Long-term investments are projected to generate one million direct employment opportunities.
- Enhanced Market Access: The pact covers over 92% of tariff lines, boosting exports for both sides.
Agreement Highlights and Economic Impact
The comprehensive TEPA consists of 14 chapters covering market access for goods, intellectual property rights, investment promotion, and sustainable development. It advances the objectives of ‘Make in India’ and ‘Atmanirbhar Bharat’.
EFTA covers 92.2% of tariff lines, representing 99.6% of India’s exports. India, in turn, covers 82.7% of tariff lines, accounting for 95.3% of EFTA’s exports, with protections for sensitive sectors like dairy, soya, coal, and agriculture.
Investment and Job Creation
The four EFTA states—Iceland, Liechtenstein, Norway, and Switzerland—have committed to increasing foreign direct investment in India. Unlike portfolio inflows, these are long-term, capacity-building investments focused on manufacturing, innovation, and research. They are expected to create deeper linkages between India’s skilled workforce and Europe’s technology ecosystems.
Streamlining Investments and Services Boost
A dedicated India-EFTA Desk, operational since February 2025, serves as a single-window platform for investors. It focuses on key sectors like renewable energy, life sciences, engineering, and digital transformation, while promoting joint ventures and SME collaborations.
With services contributing over 55% to India’s Gross Value Added (GVA), TEPA offers a platform for next-generation trade in knowledge and digital services. Services exports are set to gain through digital delivery, commercial presence, professional mobility, and Mutual Recognition Agreements (MRAs) in fields such as nursing, accountancy, and architecture.
