India's Trade Leap: Historic Pact with European Quartet Ignites Economic Optimism

The recently signed trade pact between India and the European Free Trade Association will take effect on Wednesday, heralding a significant boost for India's exports in textiles, leather, and food products, according to a government statement.

As per the Trade and Economic Partnership Agreement concluded in March after prolonged negotiations, EFTA countries, including Switzerland and Norway, are set to reduce tariffs on 92.2% of tariff lines for India. In reciprocation, India will lower tariffs on 82.7% of EFTA exports. The nations of EFTA represent a notable trading force with a combined GDP exceeding $1 trillion.

This agreement is part of a broader strategy by Prime Minister Narendra Modi to forge stronger trade relations with global powers, amid recent escalations in tariffs by the U.S. on Indian goods. The pact with EFTA aims to draw $100 billion in foreign direct investments and create a million jobs, while propping up India's nearly $4 trillion economy. Sectoral protections for pharmaceuticals and key agricultural products remain intact.

(With inputs from agencies.)