Swiss watches and Swiss chocolates will get cheaper, thanks to EFTA!

Indians are in for a treat as the government of India has inked a significant trade and investment deal with the European Free Trade Association (EFTA), comprising Iceland, Liechtenstein, Norway, and Switzerland. This agreement promises to bring down the prices of renowned Swiss watches and chocolates for Indian consumers.

Under the Trade and Economic Partnership Agreement (TEPA) with EFTA, India has committed to gradually reducing basic customs duties on chocolates, as well as wrist and pocket watches originating from Switzerland. These duties will be phased out over a seven-year period, eventually reaching zero. Currently, India imposes a substantial import duty of 30 percent on chocolates and chocolate products, and 20 percent on most Swiss watches.

The trade volume between India and the four EFTA nations amounted to $18.66 billion in 2022-23, with Switzerland leading the pack followed by Norway. India's exports to EFTA countries primarily include chemicals, pharmaceuticals, and gems, while imports consist mainly of gold, pharmaceuticals, watches, and maritime vessels.

Switzerland holds a dominant position in bilateral merchandise trade, accounting for 91 percent of the total trade with EFTA nations, making it India's largest trading partner within the bloc.

Moreover, as part of TEPA, India will also eliminate duties on a wide range of machinery items and medical devices imported from Switzerland once the agreement takes effect. Additionally, concessions have been extended to Swiss wines based on their shipping price, with reductions in duties spread over a 10-year period for higher-priced wines.

India's offer under TEPA covers a significant portion of its tariff lines, particularly focusing on sectors such as gold. However, sensitive sectors like pharmaceuticals, medical devices, and agriculture have been carefully considered, with certain exclusions and exceptions.

Overall, this trade agreement signifies a shared commitment to fair and equitable trade practices between India and EFTA nations, promising mutual benefits and enhanced economic cooperation in the years to come.