India–Switzerland Relations: Building a Strategic Partnership Beyond Trade
Context
India and Switzerland are expanding their bilateral partnership beyond traditional trade and financial cooperation. During Swiss President Guy Parmelin’s 2026 visit to New Delhi, both countries identified new areas of collaboration in defence, civil nuclear energy, sustainable infrastructure, research, artificial intelligence and skilled mobility, coinciding with the first anniversary of the India–EFTA Trade and Economic Partnership Agreement (TEPA).
Evolution of India–Switzerland Relations
India and Switzerland established diplomatic relations through the 1948 Treaty of Friendship, laying the foundation for a long-standing partnership. Switzerland subsequently contributed technical expertise and industrial capabilities to India’s modernisation efforts.
Over time, the relationship evolved considerably. Earlier tensions associated with Swiss banking secrecy gradually shifted towards cooperation on financial transparency, particularly after the implementation of the Automatic Exchange of Information (AEOI) in 2018.
The partnership has now acquired a stronger technology and innovation dimension through platforms such as Swissnex Bengaluru and the India–EFTA TEPA.
Economic and Investment Linkages
Switzerland is an important economic partner for India, with bilateral trade reaching approximately $19.55 billion in FY 2024–25. However, the trade relationship remains uneven, primarily because of India’s substantial imports of Swiss gold.
India’s exports include pharmaceuticals and organic chemicals, while Swiss companies have developed a significant presence in Indian manufacturing, engineering and consumer industries.
Switzerland has also emerged as a major source of investment in India, with around $10.87 billion in FDI between 2000 and 2025. More than 330 Swiss companies operate in India, including major firms such as ABB, Schindler and Nestlé.
Emerging Strategic Dimension
The recent engagement indicates that bilateral relations are moving beyond commercial interests towards a broader strategic partnership.
Key areas include:
Defence cooperation: Both sides have explored greater military exchanges, defence manufacturing and technology cooperation. However, Switzerland’s neutrality-based export regulations could influence the pace and scope of defence collaboration.
Civil nuclear energy: The two countries have identified nuclear cooperation as an emerging area, potentially supporting India’s efforts to diversify its clean-energy mix.
Sustainable transport: Cooperation between Indian and Swiss authorities covers tunnelling, ropeways and electric mobility. Swiss expertise can support India’s efforts to develop cleaner and more efficient transport infrastructure, particularly in mountainous and congested regions.
Mobility and Human Capital
Human mobility has become an important component of the relationship.
The Migration and Mobility Partnership seeks to facilitate legitimate movement while addressing irregular migration. It provides mechanisms for multiple-entry visas and longer-term mobility for eligible categories.
The Young Professionals Scheme further strengthens people-to-people connections by enabling young professionals between 18 and 30 years of age to undertake professional training and exchanges. The annual quota is envisaged at around 300 participants, with scope for expansion.
Such initiatives can help match Switzerland’s specialised skills ecosystem with India’s large and growing pool of skilled professionals.
Research, Innovation and Start-ups
Scientific cooperation is increasingly becoming a central pillar.
The partnership between India’s Department of Science and Technology (DST) and the Swiss National Science Foundation (SNSF) is intended to promote collaborative research in areas such as health, clean energy and space.
Cooperation with the Zurich University of Applied Sciences can strengthen links between universities, industry and deep-tech start-ups, helping translate research into commercially viable technologies.
The two countries are also seeking greater coordination on responsible AI governance, linking India’s AI initiatives with Switzerland’s planned 2027 Geneva AI Summit.
Major Areas of Concern
Despite considerable progress, several issues could constrain the partnership.
Investment protection: Differences over investor–state dispute settlement remain a major obstacle to concluding a comprehensive Bilateral Investment Treaty. Switzerland favours greater access to international arbitration, while India’s framework gives greater importance to domestic legal remedies.
Pharmaceutical intellectual property: Swiss pharmaceutical companies seek stronger intellectual-property protections, whereas India remains concerned that excessive protection could undermine access to affordable generic medicines.
Defence restrictions: Switzerland’s neutrality framework and strict rules governing military exports and re-exports may restrict deeper defence-industrial cooperation.
Trade imbalance: India’s large gold imports contribute significantly to the persistent trade deficit, highlighting the need to diversify bilateral trade.
Talent mobility: Existing professional mobility arrangements may not yet match the scale of India’s skilled workforce or the demand for specialised talent.
Way Forward
India and Switzerland should focus on converting broad diplomatic commitments into joint industrial projects, technology partnerships and research programmes.
The TEPA framework should be used to promote greater diversification of trade rather than allowing bilateral commerce to remain heavily dependent on bullion. Both sides should also pursue a balanced approach to investment protection and intellectual-property rights while preserving India’s policy space for affordable medicines.
Greater cooperation in defence manufacturing, clean energy, AI, deep-tech, sustainable transport and advanced research can create mutually beneficial supply chains and strengthen India’s technological capabilities.
Conclusion
India–Switzerland relations are transitioning from a primarily economic partnership into a broader strategic, technological and innovation-oriented relationship. Sustained progress will depend on addressing investment and intellectual-property differences while translating new agreements on defence, mobility, research and sustainable infrastructure into tangible outcomes.
Source : Hindustan Times