India and Switzerland on Monday signed a memorandum of understanding (MoU) for mutual cooperation on local governance which would enable Indian government to learn from the Swiss model of "direct democracy".

The countries would focus on sharing know-how in areas relating to e-governance, local governments' performance appraisal, public service delivery through local bodies, solution-sharing and mobilization of resources, the Swiss Embassy said in a statement .

The MoU aims at establishing projects to encourage transfer of competence between India and Switzerland for strengthening local self-governance.

"Switzerland is recognized across the world for its effective and efficient system of direct democracy," the Embassy statement said.

Switzerland has a strong tradition of participation at the local level with citizens playing an active role in politics at the local level through participation in village and cantonal (state-level) assemblies, officials said.

The MoU will afford an opportunity for Indian stakeholders to learn on systems of inter-governmental fiscal transfer, assignment of functions across different tiers of local governments in Switzerland.

The MoU will afford an opportunity for the Swiss experts to learn of the grassroots functioning of the large Indian democracy, official said.

Philippe Welti, Ambassador of Switzerland in India and Kiran Dhingra, Secretary, Ministry of Panchayati Raj, signed the MoU.