10 Mar 2024: PIB Summary for UPSC

TABLE OF CONTENTS

1. India-EFTA Trade and Economic Partnership Agreement

1. India-EFTA Trade and Economic Partnership Agreement

Syllabus: GS-3, Economics

Mains: Free trade agreement

Prelims: European Free Trade Association (EFTA) countries 

Introduction:

• India and the European Free Trade Association (EFTA) have signed a Trade and Economic Partnership Agreement (TEPA) on March 10, 2024.
• EFTA consists of Switzerland, Iceland, Norway, and Liechtenstein, aimed at promoting free trade and economic integration among its member states.

Key Highlights of TEPA:

• Investment and Job Commitments:

• • • EFTA pledges to increase foreign direct investments in India by $100 billion over the next 15 years, aiming to generate 1 million direct jobs.
    • This marks the first time in FTA history that such binding commitments have been made.

• Market Access and Tariffs:

• • • EFTA offers access to 92.2% of its tariff lines, covering 99.6% of India’s exports.
    • India reciprocates by offering access to 82.7% of its tariff lines, with exceptions for sensitive sectors like pharmaceuticals and agriculture.

• Sector-Specific Commitments:

• • • India offers 105 sub-sectors to EFTA and secures commitments in various sectors from each member state.
    • Sectors like IT services, business services, and education services are highlighted for potential growth.

• Services and Intellectual Property Rights (IPR):

• • • TEPA facilitates better access to services sectors like IT, personal, and education services through digital delivery and commercial presence.
    • Commitments related to IPR are at the TRIPS level, addressing concerns such as generic medicines and evergreening of patents.

• Sustainable Development and Transparency:

• • • TEPA emphasizes sustainable development, inclusive growth, and environmental protection.
    • It aims to foster transparency, efficiency, and harmonization of trade procedures.

• Impact on “Make in India” and Job Creation:

• • • TEPA is expected to boost domestic manufacturing in sectors like infrastructure, pharmaceuticals, and transport.
    • It is projected to create a significant number of direct jobs for India’s youth over the next 15 years, with a focus on vocational and technical training.

• Integration into EU Markets and Technology Collaboration:

• • TEPA provides an opportunity for Indian companies to access EU markets through EFTA member states.
  • It facilitates technology collaboration and access to leading technologies in various sectors, including precision engineering and renewable energy.

Conclusion: TEPA between India and EFTA represents a modern and ambitious trade agreement, aiming to stimulate economic growth, facilitate trade, and create opportunities for both goods and services sectors.

Read previous PIB articles here.