Switzerland has decided to suspend India’s Most Favoured Nation (MFN) status under their Double Taxation Avoidance Agreement (DTAA). Foreign investors are concerned about this decision. Higher tax liabilities may be faced by Indian businesses operating in Switzerland as a result of this suspension, which was prompted by India’s failure to formally notify the MFN clause. Switzerland being an important economic partner, this decision may have its effects on bilateral trade and investments, particularly in sectors like pharmaceuticals and financial services. The article would explore the implications of such a decision on India’s investment climate, a change in investor sentiment, and the steps India could take to regain confidence.