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India-EFTA set to sign trade deal on March 10

India-EFTA set to sign trade deal on March 10

India and the EFTA bloc — comprising Iceland, Liechtenstein, Norway and Switzerland — are all set to sign a free trade agreement (FTA) on Sunday (March 10), a person aware of the development said.

India is also looking to close an FTA with UK and Oman before the general election dates are announced, as it will curb the government from announcing trade deals due to the Model Code of Conduct (MCC). 

The Indian Express had reported that the European Free Trade Association (EFTA) has agreed to invest $100 billion in India over 15 years in sectors including pharma, food processing, engineering and chemical sector as part of the FTA. 

The investment commitment that has been agreed will largely come from provident funds (PFs) in EFTA countries that comprise Iceland, Liechtenstein, Norway and Switzerland, in exchange of market access into India. 

The funds from the EFTA region include Norway’s $1.6 trillion sovereign wealth fund, the world’s largest such ‘pension’ fund, which posted a record profit of $213 billion in 2023 on the back of strong returns on its investments in technology stocks. 

Festive offer

The EFTA bloc is also looking at striking joint ventures (JVs) in pharma, especially medical devices, chemical sectors, food processing sector and engineering sector. Trade experts pointed out that the investment commitment could be a crucial gain for India as it runs a high trade deficit from Switzerland, which could widen further after India eliminates duties following the deal. 

India’s main imports from Switzerland include gold ($12.6 billion), machinery ($409 million), pharmaceuticals ($309 million), coking and steam coal ($380 million), optical instruments and orthopedic appliances ($296 million), watches ($211.4 million), cotton ($81.3 million), soybean oil ($202 million) and chocolates ($7 million).