One year of the India–EFTA deal: investment promises meet export reality

The India–European Free Trade Association Trade and Economic Partnership Agreement, known as TEPA, completed its first year in force on 1 October 2026. Signed on 10 March 2024 after sixteen years of intermittent negotiations, it is India's first free trade agreement with a bloc of developed European economies: Iceland, Liechtenstein, Norway and Switzerland. It has fourteen chapters covering goods, services, investment promotion, intellectual property, government procurement and sustainable development.

TEPA's distinctive feature is not its tariff schedule but its investment pledge. The EFTA states aim to increase foreign direct investment into India by 50 billion dollars within ten years of entry into force and a further 50 billion dollars in the following five years, and to facilitate the creation of one million jobs within fifteen years, with an investment facilitation mechanism to monitor delivery. It is the first time an Indian trade agreement has linked market access to an investment and jobs target of this kind, turning the usual question — who cuts tariffs? — into a second question: does the promised capital actually arrive?

On tariffs, the EFTA states' commitments cover 92.2 per cent of their tariff lines, accounting for 99.6 per cent of India's exports, with full coverage of non-agricultural products. India's commitments cover 82.7 per cent of tariff lines, accounting for 95.3 per cent of EFTA exports. Sensitive sectors such as dairy, gold, coal and soya remain largely untouched on the Indian side. Early evidence cited at the first anniversary was encouraging for Norway: bilateral goods trade between India and Norway grew by 9 per cent and Norwegian exports to India by 34 per cent in the first nine months of TEPA, with tariffs on frozen whole Norwegian salmon falling to zero from day one.

The first anniversary was marked in New Delhi by the second India–EFTA Prosperity Summit in 2026, where Commerce Secretary Rajesh Agrawal urged exporters, industry associations and state governments to make greater use of the agreement. That message is the honest measure of TEPA's first year: the legal architecture and the investment pledge are in place, but utilisation — firms actually claiming preferences and investors actually committing capital — will decide whether the deal becomes a growth story or a well-drafted promise.