Switzerland, along with fellow European Free Trade Association (EFTA) members—Iceland, Liechtenstein, and Norway—has committed to investing $100 billion in India over the next 15 years. This significant pledge is part of the Trade and Economic Partnership Agreement (TEPA) signed in March 2024, aiming to bolster economic ties and create approximately one million jobs in India.
The TEPA seeks to enhance trade by reducing tariffs and facilitating smoother market access between India and EFTA countries. Under the agreement, EFTA nations will benefit from reduced tariffs on exports to India, covering a wide range of products from chocolates and watches to machinery. In return, India anticipates increased exports of pharmaceuticals, clothing, and machinery to these European nations.
This partnership reflects a strategic shift among European businesses, traditionally focused on China, now recognising India’s burgeoning market potential. The International Monetary Fund (IMF) projects India’s economy to grow by 7% in 2024 and 6.5% in 2025, outpacing China’s forecasts. This robust growth, coupled with a burgeoning middle class, positions India as an attractive destination for foreign investment.
Swiss companies are already expanding their footprint in India. Engineering conglomerate ABB has increased its workforce from 6,000 to 10,000 since 2020, completing eight projects since 2023 to meet rising demand. Similarly, logistics firm Kuehne+Nagel plans to open new centres in Chennai, Gurugram, and Kolkata, reflecting confidence in India’s growth trajectory.
The TEPA, pending parliamentary approval, is expected to come into effect by late 2025 or early 2026. This agreement not only signifies a deepening of economic relations but also underscores India’s emergence as a pivotal player in global trade dynamics.
