India–EFTA free trade pact: Fostering growth and cooperation

A New Gateway to Europe: India-EFTA Trade Pact Comes into Force on October 1, 2025

Date: September 26, 2025
For: Import-Export Trainees & Professionals

The international trade landscape is set for a significant shift as the landmark Economic Partnership Agreement between India and the European Free Trade Association (EFTA) officially comes into effect on October 1, 2025. For aspiring and established import-export professionals, this isn't just another headline; it's the opening of a new, high-value corridor brimming with opportunity.

This article breaks down the pact's key components, explaining what it means for you, the key sectors in focus, and the actionable steps to leverage this agreement.

Understanding the Players: India and EFTA

First, let's be clear about who is involved.

• India: The world's fifth-largest economy, a massive market with strengths in IT services, pharmaceuticals, textiles, and agriculture, and an insatiable demand for high-quality engineering goods, machinery, and specialty chemicals.

• EFTA: A bloc of four non-EU European nations—Switzerland, Norway, Iceland, and Liechtenstein. While smaller in population, they are economic powerhouses:

  • Switzerland: A global hub for precision engineering, high-end machinery, pharmaceuticals, watches, and chocolates.

  • Norway: A leader in seafood, maritime equipment, oil & gas technology, and renewable energy.

  • Iceland: Renowned for its geothermal technology, sustainable fisheries, and aluminum production.

  • Liechtenstein: A specialist in high-tech manufacturing, financial services, and precision instruments.

This partnership is a classic case of complementary economies, creating a win-win scenario.

The Core of the Pact: What Changes on October 1st?

The India-EFTA Trade and Economic Partnership Agreement (TEPA) is a comprehensive pact covering goods, services, investment, and intellectual property rights. For traders, the most immediate impact will be on customs duties.

1. For Indian Exporters:
EFTA nations will eliminate custom duties on 100% of their tariff lines for Indian products. This includes both industrial and agricultural goods. This means:

• Textiles & Garments: Indian apparel, home textiles, and fabrics become significantly more price-competitive against rivals from Bangladesh, Vietnam, and others who already enjoy duty-free access in Europe.

• Processed Food & Agri-products: Basmati rice, mangoes, processed fruits, and other items can now enter these high-income markets at a lower cost.

• Engineering Goods & Auto Components: Products like electrical machinery, auto parts, and iron and steel products will see tariffs eliminated.

• Gems & Jewellery: A key Indian export will gain a stronger foothold.

2. For Indian Importers:
India will gradually eliminate or reduce tariffs on over 95% of its tariff lines for EFTA products. This excludes some "sensitive" agricultural and industrial products. This means:

• Access to High-Quality Machinery: Swiss and Norwegian industrial machinery, machine tools, and precision instruments will become more affordable, boosting Indian manufacturing efficiency.

• Premium Consumer Goods: Swiss chocolates, watches, and cheeses will see lower import duties, creating new business opportunities in the retail and luxury sectors.

• Seafood & Specialty Foods: Norwegian salmon and other high-quality seafood will become more accessible to the growing Indian consumer market.

• Advanced Technology: Access to Norwegian renewable energy tech, Icelandic geothermal systems, and Swiss engineering solutions will be easier and cheaper.

Beyond Tariffs: The Broader Framework

The TEPA is more than just a tariff-cutting deal. It addresses modern trade challenges:

• Trade Facilitation: Simplified customs procedures will lead to faster clearances and reduced transaction times and costs.

• Services & Investment: The pact opens doors for Indian IT, legal, and financial service providers in EFTA states. Crucially, it is linked to a $100 billion investment pledge from EFTA countries into India over 15 years, targeting sectors like manufacturing, infrastructure, and green technology. This will create a ripple effect of demand for imported capital goods and raw materials.

• Intellectual Property (IP): Strong IP protections are a cornerstone, which is vital for Swiss pharmaceuticals and other innovation-driven EFTA industries.

• Sustainable Trade: The agreement includes chapters on trade and sustainable development, promoting environmental standards and fair labor practices.

Actionable Insights for Import-Export Professionals

For those in training, this is where theory meets practice. Here’s what you need to do:

1. Identify Your Niche:

• Exporters: Analyze which of your products fall under the HS Codes that are now duty-free. Focus on sectors where India has a strong advantage (textiles, gems, engineering goods, generic pharmaceuticals).

• Importers: Research EFTA companies. Do you need high-precision Swiss machine tools? Or Norwegian salmon? Understand the demand in the Indian market for these newly affordable goods.

2. Master the Rules of Origin (RoO):
This is the most critical technical aspect. Duty benefits are NOT automatic. Your product must qualify as "originating" in India or an EFTA state as per the pact's RoO criteria. You will need to:

• Understand the product-specific rules (e.g., change in tariff classification, value addition).

• Ensure your supply chains and manufacturing processes comply.

• Obtain a Certificate of Origin from the designated authority in the exporting country. This document is your passport to claiming preferential tariff rates.

3. Build New Networks:

• Attend trade fairs and webinars focused on India-EFTA trade.

• Connect with the Trade Promotion Councils of India, Switzerland, Norway, and Iceland.

• Leverage platforms like the Engineering Export Promotion Council (EEPC India) and other commodity-specific export promotion bodies.

4. Prepare for High-Value, High-Quality Trade:
EFTA markets are not about competing on the lowest price alone. They value quality, reliability, sustainability, and innovation. Ensure your business processes, product packaging, and marketing materials reflect these standards.

Conclusion: A Strategic Leap Forward

The implementation of the India-EFTA TEPA on October 1, 2025, marks a strategic leap for India's integration into global value chains. For import-export professionals, it represents a golden opportunity to diversify markets, source high-quality inputs, and enhance competitiveness.

The time to prepare is now. By understanding the legal text, identifying opportunities, and mastering the Rules of Origin, you can position yourself at the forefront of this exciting new chapter in international trade.