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India seeks service inclusion, investment commitment from Switzerland in EFTA trade deal

CNBC TV18 | 30 January 2024

India seeks service inclusion, investment commitment from Switzerland in EFTA trade deal

By Abhimanyu Sharma

India and EFTA (European Free Trade Association) member countries are negotiating a proposed trade deal TEPA (Trade and Economic Partnership Agreement) since 2008, with the latest round of talks taking place in January 2024. As part of these discussions, India is pushing for the inclusion of services in the trade deal, aiming to stimulate domestic manufacturing and attract investments from Swiss companies.

While Switzerland already levies zero customs duty on almost all its goods, government sources have indicated that India has sought commitment on investment so that the zero duty on goods can be balanced and India’s interests are protected in the bargain. While both the sides are trying to conclude the trade talks soon, a government official informed that several formalities still remain along with the text that remains to be closed.

The EFTA grouping comprises of Switzerland, Iceland, Norway & Liechtenstein, and currently has 29 free trade agreements (FTAs) with over 35 partner countries. EFTA countries are not a part of the European Union, and currently enjoy a favourable trade balance with India.

While India’s exports to EFTA countries in FY 2022-23 were $1.92 billion, India had imported goods and services worth $16.74 billion from EFTA nations in FY 2022-23.

India and EFTA have held negotiations on several chapters including trade in goods & services, intellectual property rights (IPRs), investment promotion and cooperation, rules of origin, trade facilitation and trade and sustainable development.

EFTA member Switzerland is India’s largest source of gold imports, and enjoys a huge trade surplus with India. In FY 2022-23, India had a trade deficit of $14.45 billion with Switzerland, with net imports worth $15.79 billion and net exports worth $1.34 billion.

While EFTA is seeking a duty cut for gold, Indian government sources have maintained that though the issue is being discussed, the major focus is on non-gold issues.

 source: CNBC TV18