India-EU ties may be coming of age at last

India-EU ties may be coming of age at last

The bilateral relationship between India and the European Union, marked by benign neglect for years, is becoming warmer as the two sides recognise the economic and geo-political synergies that can accrue from a closer engagement.

The India-European Union (EU) relationship seems to be coming out of the cold storage after a long time. The signs of this thaw were evident in the virtual summit between the two sides on July 15 this year - the first such meeting after a gap of two years.

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Evidence of this change in attitude began to show up in official documents in 2018 when the EU hailed India as an important pillar in a multi-polar Asia and released a new strategy for mutual cooperation that was crucial for promoting peace in the region, creating jobs both in India and in the EY, boosting economic growth and achieving the sustainable development goals committed by each side in the Paris climate pact.

Bilateral summit a turning point

The joint statement did not mention any country but made clear their mutual concern at a rising hegemon trying to assert its geo-political supremacy in Asia.

The renewed interest in fostering closer ties was evident at the 15th summit between India and the EU was held in virtual format. The joint statement issued by Indian Prime Minister Narendra Modi and European Council President Charles Micheland and European Commission President Ursula von der Leyen said it all. With EU powerhouses France and Germany pivoting towards India in their new Indo-Pacific strategies, it was but natural that the two sides decided to strengthen the India-EU Strategic Partnership, based on shared principles and values of democracy, freedom, rule of law, and respect for human rights that aim at delivering concrete benefits for the people in India and the EU.

India and the EU, which are home to the largest concentration of free people (living in democracies) in the world affirmed their determination to promote effective multilateralism and a rules-based multilateral order with the United Nations (UN) and the World Trade Organisation (WTO) at its core.

Mutual concern over rising Asian hegemon

External Affairs Minister Dr. S Jaishankar at a meeting on India European Union relations with High Representative of the EU for Foreign Affairs and Security Policy Josep Borrell Fontelles .The two sides also agreed to increase their cooperation on international security and global economic stability.
External Affairs Minister Dr. S Jaishankar at a meeting on India European Union relations with High Representative of the EU for Foreign Affairs and Security Policy Josep Borrell Fontelles .The two sides also agreed to increase their cooperation on international security and global economic stability.

The joint statement did not mention any third country but the nuances of the statement made clear their mutual concern over a rising hegemon trying to assert its geo-political supremacy in Asia.

In this context, the two sides also agreed to increase their cooperation on international security, strengthen preparedness and response for global health emergencies such as the Covid-19 pandemic, enhance global economic stability and inclusive growth, implement the Sustainable Development Goals and protect the climate and the environment.

The statement also affirmed EU's enthusiasm for India's G-20 Presidency in 2022 and its non-permanent membership in the UN Security Council in 2021-2022.

Daunting challenges

Given the importance of this FTA to both sides - and with the UK now out of the EU - it may be a good idea for Germany and France to pull their weight and lean on Brussels to bend a little to make this deal possible.

However, this should not take away from the fact that the India-EU trade pact, pending since 2007, is still a work in progress. The talks on the proposed FTA with EU are stalled because of Brussels' insistence on easier market access for goods, a stronger intellectual property regime that will hit the Indian generic pharmaceuticals sector and environmental and social clauses that India considers extraneous to trade without any reciprocal concessions on granting easier access to Indian professionals.

Given the importance of this FTA to both sides - and with the UK now out of the EU - it may be a good idea for Germany and France to pull their weight and lean on Brussels to bend a little to make this deal possible.

EU has to accommodate India's core interests

PM Narendra Modi shakes hand with French President Emmanual Macron and The Executive Director of World Bank David Malpass. With New Delhi building robust ties with Paris and Berlin the bilateral relationship with Brussels had grown a little distant.
PM Narendra Modi shakes hand with French President Emmanual Macron and The Executive Director of World Bank David Malpass. With New Delhi building robust ties with Paris and Berlin the bilateral relationship with Brussels had grown a little distant.

The Bilateral Trade and Investment Agreement (BTIA) have meandered about over the last 13 years without getting any closer to closure mainly because of the intransigence of the EU negotiators on points that India considers completely extraneous to trade.

It is imperative that the EU realises that services constitute about 60 per cent of the Indian economy and that India's main competitive advantage lies in the skills of its professionals. Unless the EU concedes ground on this issue, it could be well nigh impossible for India to make concessions in other areas.

Natural partners

Traditionally, the UK (as well as France and Germany) have driven the bilateral relationship. But following Brexit and with New Delhi building robust ties with Paris and Berlin, the two remaining economic engines of the European bloc, the bilateral relationship with Brussels had grown a little distant.

But as the free world faces up to the challenge to the global order, India and the EU are realising that they are natural partners based on their shared vision of a rules-based global order, sustainable development and Trade & investment. That is a good point to start rebuilding a relationship that shows plenty of promise but has often flattered to deceive.

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