Monday, September 30, 2024

The new TEPA agreement between the EFTA and India breaks with traditional trade agreements to accommodate Indian mercantilism

Good news! India, a rising superpower!

"... With this in mind, the interest of the EFTA states (Switzerland, Norway, Iceland and Liechtenstein) in a trade agreement with India is understandable. After 16 years and 21 rounds of negotiations, India and the EFTA signed a Trade and Economic Partnership Agreement (Tepa) in March led by Switzerland. ...

These industrial policy ambitions [Make in India] also explain why the Indian government declared the investment promotion chapter to be a “sine qua non” in the negotiations. In it, the EFTA states commit to investing 100 billion US dollars and creating one million jobs by 2040. ...

Since the turn of the millennium, the EFTA states have invested almost 11 billion US dollars in India. More than half of this amount has been invested in the last five years. ...

In terms of realpolitik, however, this appears to be a pragmatic bet. Concluding the Tepa before India reaches an agreement with the UK or the EU could give India a competitive advantage. Moreover, the additional expansion of the Swiss free trade network – with Ecuador (2020), Indonesia (2021) and the UK (2021) – promises to make Switzerland more resilient in difficult geopolitical times. Switzerland’s free trade agreements now cover 77 countries and around 55 percent of the global market. ..."

Switzerland Bets on India - Avenir Suisse

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