Sources familiar with the matter revealed that the Union cabinet is poised to discuss the draft agreement with the European Free Trade Association (EFTA) today, potentially paving the way for an announcement on Sunday. This development marks a crucial step in India’s ongoing trade negotiations and could signify the first formally signed free trade agreement among the country’s current trade discussions. Additionally, negotiations for free trade agreements with Oman and the UK are said to be in their final stages.
The cabinet meeting, scheduled for later today, is anticipated to be the final one before the Election Commission announces the polling schedule for the general elections.
Despite queries sent to various government departments remaining unanswered as of Thursday morning, reports indicate that the four nations comprising the EFTA – Iceland, Liechtenstein, Norway, and Switzerland – have proposed a trade pact that includes duty-free market access for India’s animal products, fish, processed food, and vegetable oils. Furthermore, the EFTA nations have pledged a $100 billion investment in India over the next 15 years, potentially creating around a million jobs.
Negotiations for the trade treaty between India and EFTA nations commenced in 2008, with the agreement expected to be signed as early as next week. As per the draft papers, duty-free access will commence immediately, making it the most favorable offer among India’s other FTA partners. India has also offered immediate duty elimination on 40% of trade lines with low or nil trade activities, facilitating EFTA nations to export their goods and services without tariff obligations.
India’s exports to EFTA countries in FY24 totaled $1.87 billion, while imports amounted to $20.45 billion in 2023. The agreement is poised to bolster India’s services sector, particularly in increasing exports to Switzerland and Norway.
Experts foresee significant gains in sectors such as services and investment, with expectations of benefits in emerging areas like government procurement and digital trade. The potential signing of the FTA is viewed as a significant achievement, pending the successful execution of plans, according to experts and industry professionals.