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Denmark's expertise in green technology will give India a huge boost in meeting its renewable energy target while the Indian market represents an enormous business possibility to Danish businesses for expansion and investment.
While the first mention of Denmark might conjure up images of an array of danish pastries, the country is fast emerging as climate protection leader in Europe. And it was this very expertise that was made up the foundation for the virtual summit between Indian Prime Minister Narendra Modi and Danish Prime Minister Mette Frederiksen. This was the first virtual summit between India and any European country and only the fourth such summit undertaken by PM Modi during the coronavirus crisis, a clear signal towards the importance India is placing towards this relationship.
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Bilateral trade in goods and services between India and Denmark has grown by 30.49 percent, from US$ 2.82 billion in 2016 to US$ 3.68 billion in 2019. The Indian market represents an enormous business possibility to Danish businesses due to its huge population, burgeoning and aspirational middle class and the fast-emerging rural market. Around 200 Danish companies have invested in India in sectors such as shipping, renewable energy, environment, agriculture, food processing, smart urban development. Several major Danish companies have built new manufacturing factories under the 'Make in India' scheme. Around 25 Indian companies are present in Denmark in IT, renewable energy and engineering. While major Indian IT companies such as Tata Consultancy Services (TCS), L&T Infotech, Infosys Technologies, ITC Infotech, Mahindra Satyam and Ubique Systems have investments in Denmark.
India and Denmark on Monday decided to elevate their relations to Green Strategic Partnership and reaffirmed their determination to strengthen cooperation and contribute for comprehensive reforms of the WTO. According to the joint statement, Green Strategic Partnership is a mutually beneficial arrangement to advance political cooperation, expand economic relations and green growth, create jobs and strengthen cooperation on addressing global challenges and opportunities with a focus on an ambitious implementation of the Paris Agreement and the UN Sustainable Development Goals. Several Danish companies like Babcock & Wilcox have already the first waste-to-energy facilities in Punjab and Haryana to fight air pollution. This partnership will only put Denmark in a stronger position to deliver green solutions across sectors such as renewable energy, water technology, circular economy, sustainable urban development amongst others to help India in its next phase of fighting climate change and transitioning to a greener economy.
Winds of change
Denmark is currently one of the leaders in green technology and sustainable business practices. Currently, the country sources more than 30 per cent of its energy from renewable sources and by aims to be completely independent of reliance on fossil fuels by 2050. It also holds expertise in both onshore and offshore wind energy. In 2018, the Indo-Danish cooperation on renewable energy began with a Strategic Sector Cooperation with the Ministry of New and Renewable Energy (MNRE) focused on offshore wind and the new 5-year India-Denmark Energy Partnership is expanding the cooperation to include both MNRE and the Ministry of Power (MOP). These agreements in addition to the new green strategic partnership will help Danish companies looking to invest in India in capacity building, knowledge-sharing and technology transfer on wind energy, energy modelling and integration of renewable energy.
India is currently facing one of its biggest water crisis to date. According to the Composite Water Management Index (CWMI) report released by the Niti Aayog in 2018, 21 major cities (Delhi, Bengaluru, Chennai, Hyderabad and others) are racing to reach zero groundwater levels by 2020, affecting access for 100 million people. Recent reports state that by 2030, the country′s water demand is projected to be twice the available supply, implying severe water scarcity for hundreds of millions of people and an eventual six per cent loss in the country′s GDP. In order to tackle its water woes, a new ministry, Jal Shakti (water) ministry was formed with an aim to provide piped water connections to every household in India by 2024. And here's where the Danish expertise in water management, purification and management of point-source pollution will hold India in good stead. The Danish businesses such as Grunfos known for pioneering solutions in all areas of water management sewage treatment, energy recovery, desalination, intelligent reverse osmosis systems, has already set up operations under the Make in India initiative in the country, global acclaim. These solutions won't just go a long way in solving India's water woes but also help in big river clean-up projects such as the Clean Ganga Programme.
The coronavirus pandemic has served as an eye opener for the world to move towards diversifying supply chains and reducing dependence on one nation. India has already been leading this shift with Japan and Australia, with ongoing discussions with both countries for a Supply Chain Resilience Initiative (SCRI) that will build stronger supply chains for a wide variety of products and offer the world an alternative to China's dominance of trade. Prime Minister Narendra Modi also extended an invitation to Denmark for joining India, Japan and Australia's joint efforts, saying “We are working together with Japan and Australia for supply-chain diversification and resilience. Other like-minded countries can also join this effort,” Modi said, adding that the summit “will not only prove useful for India-Denmark relations, but will also help in building a common approach towards global challenges.”
Beyond the common interests of addressing climate change, sustainable developmental and expanding trade, India's interest in Denmark is also geopolitical. India has been in negotiations with the EU on a Free Trade Agreement for a while now. Denmark holds considerable heft with the powerful Nordic bloc of countries - Sweden, Norway, Iceland, Finland- in Europe and is the only Nordic country that has made a maritime foray in the Straits of Hormuz with active assistance from the UAE with which India enjoys close ties. Furthering relations with Denmark will also go some way towards increasing India's influence with the EU and add some much-needed traction to stalled trade talks.
Dr Ishita Mandrekar is the Online Editor at 'India Global Business'.