On Sunday, India announced an economic pact that will see it lift most import tariffs on industrial products from four European countries in return for an investment of $100 billion over 15 years, concluding nearly 16 years of negotiations.
The deal follows trade pacts over the last two years with Australia and the United Arab Emirates (UAE), while officials say another, with Britain, is in its final stages. Prime Minister Narendra Modi aims for annual exports of $1 trillion by 2030.
It envisages that the European Free Trade Association (EFTA), comprised of Switzerland, Norway, Iceland and Liechtenstein, will invest $100 billion over 15 years in India's fast-growing market of 1.4 billion people, Trade Minister Piyush Goyal said.
In turn, the Swiss government said in a statement that India will lift, or partially remove, very high customs duties on 95.3% of industrial imports from Switzerland, excluding gold, either immediately or over time.
"Norwegian companies exporting to India today meet high import taxes of up to 40% on certain goods," Industry Minister Jan Christian Vestre said in a separate statement.
"With the new deal, we have secured nil import taxes on nearly every Norwegian good."
Goyal added that the pact covered issues such as intellectual rights and gender equity and toldt some new elemen at a news conference, "It is a modern trade agreement, fair, equitable, and win-win for all five countries."
The five signatories must ratify Sunday's deal before it can take effect, with Switzerland planning to do so by 2025.
The news comes ahead of general elections due by May, at which Modi will seek a record third term.
India has committed to cut its 'bound tariff rate' on gold to 39% from 40% but does not anticipate much impact on metal imports from Switzerland, estimated at $16 billion last fiscal year, an Indian government official said.
Swiss economic official Guy Parmelin said the Indian market offers immense opportunities for trade and investment. He added that the pact was the result of 21 rounds of talks.
India is the EFTA grouping's fifth-largest trading partner after the European Union, the United States, Britain, and China, with total two-way trade estimated to be $25 billion in 2023, according to its trade ministry.
"The agreement contains a comprehensive and legally binding chapter on trade and sustainable development," the Swiss government said.
"This will enable the EFTA states, in particular, to address trade-related sustainability considerations."
Analysts said the pact may not immediately help India close a large trade gap with the group, but it will help draw investment into key industries.
"The trade agreement will help attract investment in critical sectors like medical devices and clean energy and expand exports to other countries by accessing Swiss and Norwegian technologies," said trade economist Ram Singh, who heads the Indian Institute of Foreign Trade, a New Delhi think tank.
