TEPA (Syllabus: GS Paper 2 – IR)

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Context: India has signed a $100bn free trade agreement with a four-member European bloc and will lift most import tariffs on industrial products from these countries in return for the investment over 15 years.


Trade and Economic Partnership Agreement (TEPA)

  • About: TEPA represents a modern and ambitious trade agreement, marking India's first Free Trade Agreement (FTA) with four developed nations in Europe.
  • Countries: Switzerland, Iceland, Norway & Liechtenstein
  • Significant Commitments: India pledges a binding commitment of $100 billion investment and 1 million direct jobs over the next 15 years, a historic milestone in the realm of FTAs.
  • Boost to Make in India: The agreement is poised to bolster the Make in India initiative, offering opportunities for the young and talented workforce while providing a gateway to large European and global markets.
  • Comprehensive Agreement Structure: TEPA consists of 14 chapters, addressing various aspects such as market access, rules of origin, investment promotion, intellectual property rights, and sustainable development.
  • EFTA's Importance and Commitments: EFTA, alongside the EU and the UK, forms a crucial economic bloc in Europe. Switzerland, followed by Norway, emerges as India's largest trading partner within the EFTA group.


Highlights of TEPA

  • Services Sector Opportunities: TEPA opens avenues for India's services exports, particularly in IT services, business services, and other sectors of interest, with provisions for improved access and recognition agreements.
  • Intellectual Property Rights (IPR): The agreement upholds TRIPS-level commitments on IPR, addressing concerns related to generic medicines and patent evergreening while signaling a commitment to sustainable development.
  • Job Creation and Skills Development: The agreement foresees the creation of a significant number of direct jobs for India's young workforce, coupled with provisions for vocational training and technology collaboration.
  • Integration into EU Markets: TEPA offers an opportunity for Indian companies to integrate into EU markets, leveraging Switzerland's strategic position as a gateway to the European market.


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