India-Iceland Relations Explained

India-Iceland relations are the bilateral ties between the Republic of India and Iceland, a Nordic island nation in the North Atlantic, and they centre on cooperation in geothermal energy, fisheries and the Arctic, supported by the India-EFTA Trade and Economic Partnership Agreement (TEPA) and growing people-to-people links. Diplomatic relations were established in 1972, and the partnership has been friendly and free of disputes since.

Iceland has fewer than 400,000 residents, but it is a leader in renewable energy, sustainable fisheries and Arctic diplomacy, and these are areas in which India has practical interests. India-Iceland relations therefore combine learning from Icelandic expertise with a shared interest in ocean governance and polar science. This explainer, last reviewed 17 October 2026, outlines the main themes.

Key Takeaways

• India and Iceland established diplomatic relations in 1972, and the relationship has remained cordial and free of bilateral disputes.
• Geothermal energy is the best-known area of India-Iceland cooperation, with Indian professionals trained through the United Nations University Geothermal Training Programme hosted in Reykjavik since 1979.
• Iceland is a member of the European Free Trade Association (EFTA), and the India-EFTA Trade and Economic Partnership Agreement, signed on 10 March 2024, applies to Iceland, Liechtenstein, Norway and Switzerland.
• India became an observer in the Arctic Council in 2013, and Iceland, as an Arctic state, is a natural partner on polar science and Arctic governance.
• Fisheries and the blue economy are major Icelandic strengths, and India has shown interest in Icelandic expertise on sustainable fisheries, seafood processing and ocean technology.
• Bilateral trade between India and Iceland is modest in size, so the partnership is valued mainly for specialised knowledge rather than for trade volume.

What are India-Iceland relations based on?

India-Iceland relations are based on shared democratic values, a commitment to multilateralism and complementary strengths in energy, oceans and science. Iceland offers technical expertise in renewable energy and marine resource management, while India offers a large market, a skilled workforce and growing capacity in space, polar and ocean research.

There is no history of conflict or competing territorial claims between the two countries. Contact takes place through embassies, parliamentary and ministerial visits, and Nordic-level dialogue. India has held summits with Nordic leaders, including the first India-Nordic Summit in Stockholm in 2018 and the second in Copenhagen in 2022, and Iceland participated in both formats, which helped bring it into India’s wider Nordic outreach.

How did India-Iceland relations develop since 1972?

India-Iceland relations developed gradually after 1972 through technical cooperation, particularly in geothermal energy and fisheries training, before expanding to Arctic and trade-related themes in the 2000s and 2010s. For much of the period, contact was modest and mostly handled through accredited ambassadors and visiting delegations.

Iceland’s embassy in New Delhi and India’s diplomatic representation for Iceland have changed in form over time, so the current arrangements are best confirmed with the Ministry of External Affairs.

How do India and Iceland cooperate on geothermal energy?

India and Iceland cooperate on geothermal energy mainly through training, technical exchanges and project-level advice, with Iceland sharing its experience in using heat from the Earth’s crust for electricity and direct heating. Iceland meets a large share of its space-heating needs with geothermal energy and generates a significant proportion of its electricity from geothermal and hydropower sources.

The training and partnership link

The United Nations University Geothermal Training Programme (UNU-GTP), set up in 1979 and hosted in Reykjavik by Iceland’s National Energy Authority, trains professionals from developing countries in exploration, drilling, reservoir management and utilisation. Indian geoscientists and engineers have taken part, and the programme has helped create a network of specialists who understand Icelandic approaches.

India’s geothermal potential

India has identified geothermal provinces in places such as the Himalayan belt, including the Puga Valley in Ladakh, as well as Himachal Pradesh, Chhattisgarh, Gujarat and the west coast. Official surveys have estimated a potential of several thousand megawatts, although India has so far developed very little commercial geothermal capacity. Challenges include drilling costs, resource uncertainty, remote locations and limited private investment. Icelandic experience in exploration, drilling and direct-use applications such as district heating, greenhouse farming and aquaculture could inform pilots, although each site needs its own geological assessment.

Why do fisheries and the blue economy matter in India-Iceland relations?

Fisheries and the blue economy matter in India-Iceland relations because Iceland has built a highly regulated, science-based and economically important fishing sector, while India has one of the world’s largest fisheries industries and a long coastline. Icelandic expertise in quota management, value addition and use of fish by-products offers practical lessons.

Iceland also hosts the UNU Fisheries Training Programme, established in 1998, which trains fisheries professionals from developing countries. Areas of potential cooperation between the two countries include:

• Sustainable management: science-based stock assessment and catch limits.
• Processing and cold chains: reducing post-harvest losses and improving quality.
• Value addition: using fish skin, collagen and other by-products in cosmetics, medicine and food.
• Aquaculture and technology: sustainable farming methods and ocean-monitoring equipment.
• Seafood trade: Indian seafood exports and Icelandic fish products operate in different markets, so cooperation is mostly technical.

India’s own blue economy strategy and its coastal communities give such cooperation a development dimension, but fisheries remain a sensitive domestic sector, and any trade provisions are governed by the terms of India’s agreements and the EFTA framework.

What is the role of the Arctic in India-Iceland relations?

The Arctic plays an important role in India-Iceland relations because Iceland is an Arctic Council member state and India is an observer in the Council, which makes polar science and governance a shared topic. India’s Arctic activities include the Himadri research station at Ny-Alesund, Svalbard, opened in 2008, and its Arctic policy, released in 2022.

Iceland hosts the Arctic Circle Assembly in Reykjavik, a large annual gathering where officials, scientists and business leaders discuss Arctic issues, and Indian representatives have taken part. Iceland held the Arctic Council chairmanship from 2019 to 2021. India’s interests are mainly scientific, including climate and monsoon links, glaciology and ocean research, along with a commitment to respecting international law, including the United Nations Convention on the Law of the Sea (UNCLOS). Cooperation can involve joint research, data sharing and participation in assemblies, though India’s role as an observer does not give it decision-making power in the Arctic Council.

What does the India-EFTA trade pact mean for Iceland?

The India-EFTA Trade and Economic Partnership Agreement (TEPA) means that Iceland, as an EFTA member, has a free-trade-style agreement with India covering goods, services, investment and intellectual property. It was signed on 10 March 2024 and entered into force on 1 October 2025.

The EFTA states are Iceland, Liechtenstein, Norway and Switzerland, and the agreement is notable for including a non-binding commitment by EFTA to promote investment in India, widely reported as USD 100 billion over 15 years with the creation of one million direct jobs. As these are targets rather than guarantees, actual outcomes depend on private-sector decisions. For Iceland, the pact may improve access for goods such as fish products, and for services and technology firms. For India, it offers lower tariffs on many exports and a gateway to the European Economic Area through a different route than the EU. Because Iceland is the smallest of the four EFTA economies, most investment and trade effects are expected to be linked to Switzerland and Norway, though specialised Icelandic niches, such as biotechnology and renewable energy, could benefit.

How large is India-Iceland trade and what is exchanged?

India-Iceland trade is small, generally in the tens of millions of US dollars annually, with figures varying by year and source. India exports items such as textiles, pharmaceuticals, machinery, food products and engineering goods, while Iceland exports fish products, aluminium-related products and specialised equipment.

Some business ties exist in biotechnology and pharmaceuticals, where Icelandic and Indian companies have formed commercial partnerships, and in marine equipment and renewable energy services. Iceland’s economy relies on tourism, fisheries, aluminium smelting powered by renewable electricity and a growing technology and biotech sector. Under the TEPA, tariffs on many products are expected to fall, and this could encourage trade. However, small volumes and long distances mean that growth will probably be gradual.

What are the people-to-people links between India and Iceland?

People-to-people links between India and Iceland are modest but visible, including tourism, student exchanges, cultural events and the small Indian community in Iceland. Iceland has drawn Indian tourists with its landscapes, and Indian films have used Icelandic locations, which helped raise the country’s profile in India.

Yoga and Indian cuisine have followers in Reykjavik, and Indian professionals work in sectors such as healthcare, technology and research. Universities in both countries have explored exchanges, particularly in geosciences, energy and marine science. Iceland’s small population means personal and institutional contacts matter a great deal, and individual research partnerships can have a disproportionate effect on the relationship.

What challenges and opportunities lie ahead?

The main challenge for India-Iceland relations is scale, since Iceland’s tiny economy and distance from India limit the volume of trade and investment, while the main opportunity lies in niche technical cooperation and the new trade framework. Both countries have an interest in energy transition, ocean governance and the sustainable use of marine resources.

• Geothermal pilots: Joint feasibility studies, especially for direct-use heating, could demonstrate viable models in Indian conditions.
• Blue economy: Cooperation on sustainable fisheries, ocean observation and seafood processing.
• Arctic science: Expanded research partnerships and exchanges through assemblies and institutions.
• Trade and investment: Using TEPA to build business links in biotechnology, renewable energy, shipping and tourism.
• Limits: Small markets, geological uncertainty, funding constraints and competing priorities on both sides.

Whether the partnership grows will depend on specific projects and institutional follow-through rather than on declarations alone.

Bottom Line

India-Iceland relations are a small but constructive partnership founded in 1972 and built on geothermal training, fisheries expertise, Arctic dialogue and the India-EFTA trade agreement. Their strength lies in practical knowledge exchange, and their growth will be gradual and project-driven.

Frequently Asked Questions

When were India-Iceland diplomatic relations established?

India and Iceland established diplomatic relations in 1972. The relationship has remained friendly and free of disputes since then. Contact has grown through technical training, Nordic summits and, more recently, the India-EFTA trade agreement.

How do India and Iceland cooperate on geothermal energy?

India and Iceland cooperate on geothermal energy mainly through training and technical exchange. Indian professionals have trained at the United Nations University Geothermal Training Programme in Reykjavik, which started in 1979. India has geothermal resources, such as in Ladakh, but has developed little commercial capacity so far.

Is Iceland part of the India-EFTA trade agreement?

Yes, Iceland is a member of the European Free Trade Association (EFTA) and is covered by the India-EFTA Trade and Economic Partnership Agreement. The agreement was signed on 10 March 2024 and entered into force on 1 October 2025. The other EFTA members are Liechtenstein, Norway and Switzerland.

What is India’s role in the Arctic and how does Iceland fit in?

India is an observer in the Arctic Council, a status it received in 2013, and it runs the Himadri research station in Svalbard. Iceland is a full member of the Council, so it is a natural partner on polar science and governance. India’s role is scientific and consultative rather than decision-making.

How big is India-Iceland trade?

India-Iceland trade is small, generally in the tens of millions of US dollars a year, though figures vary by year and source. India exports textiles, pharmaceuticals, machinery and food products, while Iceland exports fish products and specialised equipment. The India-EFTA agreement may encourage growth over time.

Why is Iceland important for India’s fisheries and blue economy?

Iceland is important because it has a science-based, well-managed fisheries sector and strong expertise in processing and using fish by-products. Iceland also hosts the UNU Fisheries Training Programme, which trains professionals from developing countries. India can draw on these lessons for sustainable fisheries and its own blue economy strategy.

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