Economy & Business

    'India to attract more foreign investment from EFTA': Swiss Federal Councillor after trade pact

    The Hawk
    March10/ 2024
    Last Updated:

    India and EFTA Sign Landmark Trade Agreement, Promising Economic Growth and Job Creation. Swiss Investments Set to Boost India's Manufacturing Potential and Innovation Capabilities, Fostering Deepened Economic Partnership.

    India EFTA agreement

    New Delhi [India]: After a landmark trade agreement was signed between India and the European Free Trade Association (EFTA), Swiss Federal Councillor Guy Parmelin said New Delhi will attract more foreign investment from the EFTA, which will lead to an increase in good jobs.
    India signed the Trade and Economic Participation Agreement (TEPA) with the four-nation European Free Trade Association on Sunday.

    The Swiss Embassy highlighted that the landmark agreement between India and EFTA is set to bring significant economic benefits.
    The benefits included, "better integrated and more resilient supply chains, new opportunities for businesses and individuals on both sides leading to increased trade and investment flows, job creation, and economic growth."
    "Our companies strive to diversify their supply chains while rendering them more resilient. India, in return, will attract more foreign investment from EFTA, which will ultimately translate into an increase in good jobs," the embassy said.
    The agreement was signed by Union Commerce Minister Piyush Goyal; Swiss Federal Councillor and Head of the Federal Department of Economic Affairs, Education and Research Guy Parmelin; Bjarni Benediktsson, Minister of Foreign Affairs, Iceland; Dominique Hasler, Minister of Foreign Affairs, Liechtenstein; and Jan Christian Vestre, Minister of Trade and Industry, Norway.
    At the signing ceremony, Swiss Federal Councillor Guy Parmelin, speaking on behalf of the EFTA Member States, emphasised, "EFTA countries gain market access to a major growth market."
    Moreover, the agreement enhanced market access and simplified customs procedures, making it easier for Indian and EFTA businesses to expand their operations in the respective markets, the statement by the Swiss embassy noted.
    "The agreement further aims to facilitate and promote investment opportunities between the parties," it added.
    The agreement marks a significant milestone in the relationships between the EFTA States and India.
    "It reflects the culmination of dedicated efforts to foster a deeper economic partnership, underscoring the importance of dialogue, cooperation, and mutual understanding," the statement read.
    Moreover, the Swiss embassy also released a fact sheet, stating that the TEPA pact is critical for the realization of Make in India, and adding that Switzerland is India's seventh most important
    investor, according to the IMF, with an annual investment growth of 9 per cent.
    The agreement "brings Swiss investments and innovation to India, and can potentially turn India into an innovation hub for the world. Switzerland has been ranked number one in the Global Innovation Index for 13 consecutive years," it added.
    The TEPA pact also facilitates India's access to Swiss world-leading technologies.
    Notably, innovative and state-of-the-art products such as precision machinery will strengthen India's manufacturing potential and thus support 'Make in India'.
    The agreement will also foster cross-border investments.
    "Swiss companies, mostly SMEs, strive to diversify their supply chains by manufacturing in India," the embassy stated.
    It will further increase the attractiveness of India, promoting the creation of joint ventures and partnerships in India, and consequently increasing FDI into production, development and research.
    The Swiss Embassy emphasised that the agreement will also help in creating jobs for India's young workforce, adding that Swiss investments always come with the training of the labour force (technical and vocational training).
    "It will promote the mobility of Indian talents. Many large and midsize companies rely on services provided by Indian companies deploying Indian talents for specific projects," the statement read.
    The agreement also offers unprecedented access to Indian suppliers in numerous service sectors.
    For the first time, Switzerland will provide access to independent professionals and include commitments for spouses and dependents, as per the statement.
    "India will therefore have a comparative advantage in some service sectors compared to other free trade partners of Switzerland," it added.
    The agreement will spur Swiss investments in India through in-depth exchanges between Swiss and Indian board directors and CEOs, supported by ambitious investment roadmaps and concrete action plans.
    The agreement will "turn India into a global health and life sciences hub. Increased legal certainty and a stable and efficient intellectual property framework bring further investment from innovative Swiss companies to India. Combined with India's strong knowledge base in pharmaceutical manufacturing and its leading role in IT, it moves India up the value chain towards an innovation hub at a global level," the statement noted.
    It will also offer better access to cutting-edge Swiss technology for Indian companies, coupled with the transfer of know-how and training of qualified personnel for on-site manufacturing and servicing, enabling local employment.
    The statement further highlighted that the agreement supports sustainability, in line with India's ESG ambitions.
    Swiss companies investing in India will promote advanced, energy-efficient, low-pollution and clean manufacturing, thereby matching India's energy transition, increasing the efficiency and productivity of Indian companies, leading to higher profits, spreading good practices and contributing to higher competitiveness of India.
    Moreover, the pact will increase trade in innovative pharmaceutical products and modern medical equipment suitable to support the Indian healthcare system and provide state-of-the-art health services for the benefit of Indian citizens.
    It also "sets an important trade standard regarding the protection of Indian speciality products as geographical indications, by covering all products, including rice, silk and handloom products, and lays the basis for specifically protecting and thus promoting the export of Indian speciality products," the statement noted.