Economic ties between India and Sweden are strong and growing, but they are still relatively small compared to engagement with larger economies like the U.S. and China. The Confederation of Swedish Enterprise surveyed Swedish companies to understand how to create favourable conditions and policies for their increased economic activity in India.
The survey results reveal that legal certainty and predictable market access are important to Swedish investors. Improved customs procedures, lower tariffs, and alignment with international product standards could attract more Swedish manufacturing to “Make in India”. Furthermore, alignment with international product and sustainability standards, would positively affect Swedish firms interests in buying from India, thus improving Indias trade balance and integration into GVCs. Swedish exporters desire better access to the Indian market, primarily through a reduction of customs formalities and lower tariffs.
A Free Trade Agreement (FTA) between the EU and India will improve investor sentiment by creating a more predictable and transparent business environment and reduce trade barriers both in the EU and in India, which is a cornerstone for increased foreign investment. The FTA should prioritise reducing barriers to trade in as many sectors as possible, rather than non-trade provisions.
Additionally, The EU-India Trade and Technology Council (TTC) should be more ambitious. Indian firms should receive technical assistance for the cost-efficient convergence towards international and EU product and sustainability standards. Trade promotion and facilitation activities are essential to mitigate the perception of India as a high-risk market and to encourage economic engagement.