India–EFTA Trade and Economic Partnership Agreement (TEPA)

Introduction

• The India–EFTA TEPA is India’s Free Trade Agreement with the European Free Trade Association bloc of Switzerland, Norway, Iceland, and Liechtenstein.
• It aims to strengthen trade and investment ties, reflecting India’s growing role in global value chains and its strategy to expand market access while attracting foreign investment.

Why in news?

• Finalised in March 2024, the agreement came into effect on 1 October 2025.

Background

• The agreement complements India’s recent FTAs with the UAE, Australia, and the UK.
• A dedicated EFTA Desk, operational since February 2025, serves as a singlewindow mechanism to facilitate EFTA investments and operations in India.

Significance

• Enhanced market access: EFTA has provided 100% market access for India’s industrial and nonagricultural products, with tariff concessions on processed agricultural products.
• Investment and jobs: EFTA nations have a binding investment commitment of USD 100 billion over 15 years, expected to generate 1 million direct jobs in India.
• Trade facilitation: The institutional mechanism supports EFTA businesses in investing, expanding, and operating in India.
• Regulatory alignment: Product certifications are aligned, reducing compliance costs.

Facts/General knowledge

• What FTAs are: Pacts between two or more countries to reduce or eliminate trade barriers such as tariffs and quotas on goods and services.
• India’s FTAs: Existing agreements with Japan, Australia, the UAE, Mauritius, the European Free Trade Association (EFTA), Singapore, and Sri Lanka; India–EU FTA is in advanced negotiations.
• Gains from FTAs: Market access: Reduced tariffs and barriers (e.g., under India–UAE CEPA, dutyfree access to 90% of exports; exports grew 12% in the first year).

• Investment boost: Attract stable FDI (e.g., India–Australia ECTA led to a 25% surge in FDI inflows).
• Agriculture gains: New export markets (e.g., India–Mauritius CECPA increased sugar and tea exports).
• Technology transfer: Access to advanced technologies (e.g., India–Australia ECTA in renewables aiding energy transition).
• SME support: Better integration into global value chains (e.g., India–Singapore CECA benefits SMEs in IT and engineering).
• Concerns with FTAs: Trade deficits: Rising imports versus stagnant exports (e.g., India–ASEAN FTA saw imports rise to USD 44 billion in FY23).
• Limited developed market access: Nontariff barriers (e.g., delay with the EU due to IPR and data issues).
• Risks to small farmers and MSMEs: Competition from cheap imports (e.g., rubber farmers under the ASEAN FTA).
• Labour and environmental clauses: Conditions like the EU’s Carbon Border Adjustment Mechanism may hurt exports.
• Weak dispute resolution: Slow or unbalanced mechanisms (e.g., disputes with ASEAN on palm oil and machinery tariffs).
• Measures to strengthen India’s global trade position:
• Strengthen export competitiveness through quality, branding, and technology upgrades.
• Diversify trade partners across Africa, Latin America, and the Asia–Pacific.
• Support MSMEs and startups with easier credit, logistics, and ecommerce access.
• Improve infrastructure via ports, logistics hubs, freight corridors, and cold chains.
• Enhance compliance and standards for international quality, labour, and environmental norms.
• Leverage digital trade platforms, virtual trade shows, and online FTA utilisation.

Freedom Edge Trilateral Military Exercise

Introduction

• The United States, South Korea, and Japan have begun the joint multidomain military exercise "Freedom Edge" in international waters off South Korea’s Jeju Island.
• The fiveday drill runs from 15–19 September, involving air, sea, and cyber forces.

Why in news?

• It marks the latest effort to institutionalise trilateral security cooperation in response to growing nuclear and missile threats from North Korea.
• This iteration underscores continued coordination among the three countries.

Background

• The exercise is a direct outcome of agreements made at the Camp David summit in 2023 to bolster combined operational capabilities.
• It is the third in the series, following drills held in June and November of the previous year.

Significance

• The primary objective is to strengthen collective defence capabilities and interoperability to deter and respond to North Korea’s evolving threats.
• Training includes ballistic missile defence, air defence drills, maritime operations, and medical evacuation.
• North Korea has condemned the exercises as a “reckless show of strength” that will have negative consequences.

Facts/General knowledge

• Trilateral Cooperation: International cooperation involving three countries; here, the US, South Korea, and Japan.
• MultiDomain Exercise: Integration of capabilities across land, sea, air, space, and cyberspace to simulate a comprehensive response to threats.
• Ballistic Missile Defence: Systems designed to detect, track, and intercept incoming ballistic missiles.
• Jeju Island: A South Korean island in the Korea Strait, an important strategic location for naval operations.

India–Mauritius satellite tracking station near Diego Garcia

Introduction

• India and Mauritius have signed a historic agreement to establish a satellite tracking and communication station near Diego Garcia in the Chagos Archipelago.
• The facility will enable India to track and receive data from its satellites and launch vehicles.
• It will serve as a strategic asset for India.
• Both sides renewed an agreement for India’s support for hydrographic surveys in Mauritius’s Exclusive Economic Zone (EEZ).

Why in news?

• The step strengthens India’s strategic presence in the Indian Ocean Region (IOR) amid increasing Chinese maritime activities.
• The agreement was signed during Mauritius Prime Minister Navinchandra Ramgoolam’s visit to India.
• Prime Minister Modi called this step a “historic milestone” and reaffirmed India’s commitment towards anticolonialism and regional cooperation.

Background

• The station will be located near Diego Garcia, the USBritish military base in the Chagos Archipelago.
• The Chagos Archipelago was originally part of Mauritius; in 1965, three years before Mauritian independence, Britain separated it.
• Britain leased the largest island, Diego Garcia, to the United States for the construction and operation of a joint BritishAmerican military base.
• In 2019, the International Court of Justice ruled that Britain’s control over the Chagos Archipelago was illegal and that it should be returned to Mauritius.
• Britain agreed in October 2024 to return the Chagos Archipelago to Mauritius.
• London and Port Louis signed the transfer agreement on 22 May 2025, with the condition that Diego Garcia will be leased back to Britain for at least 99 years so that the BritishAmerican joint military base can continue.

Significance

• Enhances India’s capacity to track satellites and launch vehicles and to receive data.
• Expands India’s strategic presence in the IOR.
• Reinforces cooperation through renewed hydrographic survey support in Mauritius’s EEZ.
• Aligns with stated commitments to anticolonialism and regional cooperation.

Facts/General knowledge

• The Chagos Archipelago is strategically located between East Africa, the Middle East and South Asia.
• Diego Garcia hosts a major USBritish naval and air base used in operations in Iraq, Afghanistan and the Gulf.
• Port Louis: Earlier this year, New Delhi and Port Louis agreed on enhanced use.
• During his visit to Mauritius, Mauritius President Dharambeer Gokhool honoured Mr Modi with the Grand Commander of the Order of the Star for his outstanding contribution to the IndiaMauritius partnership.
• The Atal Bihari Vajpayee Institute of Public Service and Innovation was inaugurated in Mauritius; it will function as a centre for learning, research and public service.

Sushila Karki becomes Nepal’s first woman Prime Minister

Introduction

• Nepal President Ram Chandra Poudel appointed former Chief Justice Sushila Karki as the country’s first woman Prime Minister.
• She is widely respected for integrity and an anticorruption stance.

Why in news?

• Sushila Karki was sworn in as Prime Minister following a presidential appointment.
• India welcomed the new government, expressing hope for peace and continued partnership.

Background

• The President dissolved Parliament and announced fresh elections for 5 March 2026.
• This followed intense Gen Zled protests that ousted Prime Minister K.P. Sharma Oli, triggered by corruption, misrule, and a controversial social media ban.
• Her appointment, backed by protesters, followed extended consultations involving legal experts, political leaders, and the Army.

Significance

• She leads an interim Cabinet tasked with restoring order, investigating recent violence, and preparing for elections.
• The appointment reflects public backing for integrity and anticorruption.
• India’s positive response signals intent for continued partnership.
• Nepal is strategically important, located between India and China.

Facts/General knowledge

• Border: Nepal shares a border with Sikkim, West Bengal, Bihar, Uttar Pradesh, and Uttarakhand.
• Ties: Ageold civilisational and cultural links underpin strong peopletopeople connections.
• Policy: Nepal is a priority partner of India under its ‘Neighbourhood First’ Policy.
• Defence and security: Longstanding, extensive, mutually beneficial cooperation.

• Armies share excellent, harmonious relations based on mutual trust and respect.
• Tradition of awarding the Honorary rank of General to each other’s Army Chief.
• Relations further cemented via the Gorkha Regiment.
• Developmental partnership: Over 1,500 scholarships annually for studies in medicine, engineering, agriculture, and traditional arts.

• The Indian Technical & Economic Cooperation (ITEC) programme offers training, consultancy, study tours, and feasibility studies for Nepali professionals.
• Economic and commercial cooperation: India is Nepal’s largest trade and investment partner: 33.5% of Nepal’s total FDI (USD 670 million) and 64.1% of overall trade (USD 8.85 billion in FY 2022–23).
• Nepal is India’s 17th largest export destination: Indian exports USD 8.015 billion; Nepalese exports to India USD 839.62 million.
• India receives 67.9% of Nepal’s exports, mainly edible oil, coffee, tea, and jute.
• Nepal imports petroleum products, iron and steel, cereals, vehicles, and machinery from India.
• Around 150 Indian ventures operate in Nepal across manufacturing, services, energy, and tourism.
• India imports surplus electricity from Nepal.