Davos, Switzerland – The annual World Economic Forum (WEF) in Davos has become the epicenter of discussions surrounding a significant surge in interest from Swiss firms in India, spurred by the recently established Trade and Economic Partnership Agreement (TEPA) with the European Free Trade Association (EFTA). This burgeoning enthusiasm signifies a potentially transformative phase in economic relations between Switzerland and India.
The India-EFTA trade deal, which has been years in the making, officially came into effect recently and is already demonstrating its potential to reshape bilateral economic ties. The agreement involves four countries, Switzerland, Norway, Iceland, and Liechtenstein, and it pledges to cut tariffs on 92.2% of Indian product categories. A key component of the TEPA is the commitment from the EFTA nations to invest \$100 billion in India over the next 15 years. This investment is expected to focus on technology, manufacturing, textiles, leather, and food products.
Following the trade agreement, the frequency of investment inquiries and requests for advisory support has more than doubled. The Swiss Indian Chamber of Commerce (SICC) has been actively involved in facilitating this increased engagement. Recognizing Karnataka's strengths in engineering, precision manufacturing, innovation, and skilled talent, the SICC signed a Memorandum of Understanding (MoU) with the Government of Karnataka at the WEF Annual Meeting 2026 in Davos. This agreement establishes a framework to bolster Swiss industry engagement and investment within the state.
Satish Rao, the president of the SICC, emphasized that Swiss companies are now focused on executing their India strategies, and the MoU with Karnataka provides a structured approach for long-term investment and expansion. Karnataka already hosts a significant portion of Swiss economic activity in India, with approximately 18% of Swiss companies in the machine, electrical engineering, and precision sectors operating in the state, and Bengaluru serving as home to a substantial number of Swiss research and development centers.
Helene Budliger, Switzerland’s State Secretary for Economic Affairs, has expressed great confidence that the EFTA nations will meet their investment target in India within the stipulated timeframe. She noted the strong interest from the Swiss private sector in boosting ties with India, viewing the trade pact as a "booster" for bilateral economic relations.
The TEPA aims to improve market access for Swiss goods and services in India, including pharmaceuticals, machinery, optical instruments, watches, and processed agricultural products. It also increases legal certainty and predictability for bilateral economic exchanges. For India, the agreement includes legally binding provisions on trade and sustainable development, marking a significant step in its trade agreement practices.
In addition to the EFTA agreement, India is also in discussions with the European Union (EU) for a free trade agreement. European Commission President Ursula von der Leyen has referred to the potential India-EU trade deal as the "mother of all deals", envisioning a market encompassing two billion people and a quarter of global GDP.
These developments signal a promising era for economic cooperation between Switzerland and India, with the EFTA trade deal serving as a catalyst for increased investment and stronger bilateral ties.
