India Native Payments: $100bn! India is about to finalise an unprecedented investment deal

According to well-informed sources, India is on the verge of finalising a massive $100 billion investment deal with several European countries. The agreement is aimed at providing these countries easier trade access to the world's most populous nation.

The European Free Trade Association (EFTA), which includes Norway, Iceland, Liechtenstein and Switzerland, has committed to invest in India under a trade deal that is in the final stages of negotiation.

The general framework of the agreement has been agreed upon and the focus is now on the final amount to be invested. European countries are expected to invest $100 billion in India over 15 years, a sum that is expected to create more than a million jobs in the country.

India wants this investment commitment to be legally binding, while countries like Switzerland and Norway prefer to see it as a goal that is not legally mandatory, a European official said.

Switzerland and India have agreed on a free trade deal after 16 years of negotiations, Swiss Economy Minister Guy Parmelin said last month. The contours of the trade deal have been defined and officials are working to finalise the details.Parmelin also mentioned that the agreement "will create jobs for young people in India and ensure employment in Switzerland."

A statement issued by the Swiss Federal Department of Economic Affairs noted that the text of the agreement "remains to be finalised and the parties have agreed not to disclose specific details at this stage." The main agreements reached include patent protection and investment promotion.

The agreement will also ensure easier access to EFTA for Indian professionals and facilitate access to the market for certain agricultural products, the said sources said. Despite Switzerland's protection policy for its farmers, easier access to the EFTA market for Indian rice may be acceptable due to lower rice production in Switzerland.

As of today, Switzerland is the largest business partner of India among the EFTA member countries. In FY 2022-23, Switzerland's bilateral trade with India reached $17.14 billion.

For EFTA members, the 16-year-old deal will allow manufacturers to export processed food and beverages, electrical machinery and other engineering products at lower tariffs to a vast market of 140 million people. The trade deal is also likely to benefit the EU's pharmaceutical and medical device industries.

India's rapid economic development has attracted the interest of investors from several countries. In mid-January this year, India became the fourth largest stock market in the world. According to Morgan Stanley, India is expected to become the third largest stock market in the world by 2030.

With steady domestic demand and private investment, India is likely to grow at a GDP rate of more than 71 TP3T in the next financial year and maintain a high growth trajectory in the coming years to stand out in terms of growth rate, according to a recent economic assessment report released by the Ministry of Finance.

India plans to attract $100bn a year in foreign direct investment (FDI) over the next few years, Information Technology Minister Ashwini Vaishnaw said recently.