![\"Significance](\"https:\/\/i0.wp.com\/forumias.com\/blog\/wp-content\/uploads\/2024\/05\/Significance-of-India-EFTA-trade-deal.webp?resize=633%2C422&ssl=1\")
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Source<\/strong>-This post on significance of India-EFTA trade deal <\/strong>has been created based on the article \u201cInvestment lessons from the India-EFTA trade deal<\/strong>\u201d published in \u201cThe Hindu<\/strong>\u201d on 12 May 2024\/<\/p>\n UPSC Syllabus: GS Paper-2<\/strong>– International Relations-<\/strong>Bilateral, Regional and Global Groupings and Agreements involving India and\/or affecting India\u2019s interests.<\/p>\n Context<\/strong>-The negotiations with countries like the UK and European Union (EU) are currently stalled due to the ongoing parliamentary elections. However, before the elections, India secured a historic trade deal in March with the European Free Trade Association (EFTA), comprising Iceland, Liechtenstein, Norway, and Switzerland. Significance of India-EFTA trade deal<\/strong><\/p>\n Read more- India-EFTA trade deal.<\/a><\/p>\n This newly minted Trade and Economic Partnership Agreement (FTA) between India and EFTA is expected to boost the low levels of existing trade between the two sides.<\/p>\n 1) Inclusion of environment & labor<\/strong>-This FTA is significant because India has agreed to include issues like environment and labor, which it has traditionally opposed in trade agreements.<\/p>\n 2) Investment Chapter-<\/strong>It is also unique as it includes a detailed investment chapter, which is missing in India’s other recent FTAs with countries like Australia, UAE, and Mauritius. The investment chapter focuses on investment facilitation, not merely protection.<\/p>\n 3) Foreign Direct Investment<\/strong>– India persuaded EFTA countries to try to raise foreign direct investment (FDI) to India by $50 billion over 10 years, then another $50 billion in the next 5 years.<\/p>\n 4) Employment Generation-<\/strong>It will facilitate the generation of 1 million jobs in India.<\/p>\n 5) Obligation of conduct<\/strong>– These rules codify an “obligation of conduct,” which means EFTA countries must honestly try to reach these goals.However,they are not forced to achieve them. This sets a good example for negotiations with the UK, EU, and other countries.<\/p>\n India’s earlier FTAs with countries like Japan, Korea, Malaysia, and Singapore included binding rules on both trade and investment. This approach demonstrated the inextricable linkage between trade and investment.<\/p>\n However, India has changed its approach recently. Instead of combining international trade and investment laws in its FTAs, it’s now separating them. For ex- with countries like Australia, Mauritius, and the UAE, India prefers to negotiate trade and investment agreements separately.<\/p>\n Thus India-EFTA trade deal that includes an investment chapter within the trade agreement, assumes great significance in this context.<\/p>\n India needs a clear FTA policy, especially in dealing with international trade and foreign investment laws such as-<\/p>\n 1) There is a need to negotiate trade and investment as part of one comprehensive economic treaty, rather than decoupling them.<\/p>\n 2) There is a need to expand the scope of investment issues from mere facilitation to effective protection. Further, there must be an enforceable dispute settlement mechanism under international law.<\/p>\n 3) In the backdrop of declining FDI levels in India, it is important to provide enforceable legal protection to foreign investors under international law. This move will boost their confidence.<\/p>\n Question for practice<\/strong><\/p>\n What is the significance of India-EFTA trade deal?<\/p>\n","protected":false},"excerpt":{"rendered":" Source-This post on significance of India-EFTA trade deal has been created based on the article \u201cInvestment lessons from the India-EFTA trade deal\u201d published in \u201cThe Hindu\u201d on 12 May 2024\/ UPSC Syllabus: GS Paper-2– International Relations-Bilateral, Regional and Global Groupings and Agreements involving India and\/or affecting India\u2019s interests. Context-The negotiations with countries like the UK… Continue reading Significance of India-EFTA trade deal<\/span><\/a><\/p>\n","protected":false},"author":10320,"featured_media":295585,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[1230,9],"tags":[212,239,10498],"class_list":["post-295492","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-9-pm-daily-articles","category-public","tag-gs-paper-2","tag-international-relations","tag-the-hindu","entry"],"jetpack_featured_media_url":"https:\/\/i0.wp.com\/forumias.com\/blog\/wp-content\/uploads\/2024\/05\/Significance-of-India-EFTA-trade-deal.webp?fit=1280%2C853&ssl=1","views":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/295492","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/10320"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=295492"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/295492\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media\/295585"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=295492"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=295492"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=295492"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}What is India- European Free Trade deal?<\/strong><\/h2>\n
What is the significance of this FTA?<\/strong><\/h2>\n
What is India\u2019s FTA 2.0 approach?<\/strong><\/h2>\n
What should be the way forward?<\/strong><\/h2>\n