Without a bilateral investment treaty, binding FDI commitments in FTAs remain aspirational. Comment in the context of India–Switzerland relations.

The India–EFTA TEPA came into force in October 2025. It carries India's first binding FDI pledge: USD 100 billion and 1 million jobs over 15 years [2]. Yet the 1997 India–Switzerland BIT was ended under India's BIT reset, and a new treaty is still under negotiation [3]. The statement largely holds, though a BIT alone will not close the gap.

Why the pledge remains aspirational

• Soft wording: EFTA States "shall aim to" raise FDI and need only promote it. The investment chapter is also excluded from TEPA's dispute settlement [1].
• Slow remedy that hurts India too: India can seek consultations only after the 15-year final review, then wait out a 3-year grace period. Even then it may only temporarily rebalance tariff concessions [1], which raises costs for Indian buyers.
• No investor protection: Governments cannot order private firms to invest, and firms want treaty cover. This is why Switzerland is pressing for an investment protection agreement "quickly" [4].
• Tax friction: The Supreme Court's Nestlé (2023) ruling held that the DTAA's MFN clause needs a government notification before it applies [5]. Switzerland then restored a 10% dividend rate from January 2025 [6].
• Scale gap: EFTA's FDI stock in India was only USD 10.7 billion in 2022 [1].

Why "aspirational" overstates the case

• Capital flows without a BIT: Swiss FDI in India grew 53% during 2015–2023 [3], even after the decision to end the old BIT.
• Monitoring built in: An Investment Sub-Committee reviews progress at 5, 10 and 15 years [1]. The India–EFTA Desk acts as a single window for investors [2].
• Political will: Switzerland said its MFN move would not affect the FTA or Swiss investment [6].

Way forward

• Conclude a BIT that builds on the 2016 Model BIT [7]. It should balance investor protection with India's room to regulate, especially for public health.
• Settle the DTAA dispute alongside the BIT.
• Publish yearly FDI data for each EFTA state instead of waiting for the five-year review.

TEPA thus turns goodwill into a target, not a guarantee. A BIT gives investors legal certainty, while stable tax rules and investor facilitation give them a reason to come. A balanced India–Switzerland BIT before the first review, due by 2030, would make the USD 100 billion pledge credible and advance SDG 8 (decent work and economic growth).