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India-Germany Relations

  • Category
    International Relations
  • Published
    11th May, 2022

Context

Germany and India signed a series of bilateral agreements focused on sustainable development that will see the South Asian nation receive 10 billion euros ($10.5 billion) in aid by 2030 to boost the use of clean energy.

  • The accords were signed during a visit to Berlin by Prime Minister Narendra Modi.
  • Germany Chancellor Olaf Scholz is seeking to elicit India's support for the tough stance taken by Europe and the United States toward Russia over the war in Ukraine.

 PM Modi held bilateral talks with Cha­ncellor Olaf Scholz and participated in the sixth round of Inter-Governmental Con­sultations (IGC) between the two countries.

The Sixth German-Indian intergovernmental consultations

  • It is a discussion format that Germany conducts with only a few select partners.
  • Location: Held in Berlin
    • Focus area: global security policy issues, deepening of bilateral relations and climate crisis.

Background

Germany and India’s diplomatic relations date back more than seven decades.

  • In 1951, India was one of the first countries to grant the Federal Republic of Germany diplomatic recognition following the Second World War.
  • Today, the countries are linked by a strategic partnership.
    • o   One of its key pillars is their shared interest in strengthening multilateral cooperation and in promoting stability and security in the Indo-Pacific region.
  • India is also Germany’s largest Global Development Partner. This partnership, too, focuses on climate protection and mitigating the effects of global warming.
  • Efforts here include expanding renewables, increasing energy efficiency and promoting a sustainable economy.
  • In March 2021, the two countries celebrated 70 years of diplomatic relations.

Info

  • Since 2011, bilateral intergovernmental consultations have been held every two years, alternately in Germany and India. The talks aim to further deepen the countries’ many areas of bilateral cooperation. 

Analysis

Why India assumes significance for Germany?

  • Since the independence Germany and India has maintained a historical ties in the skill development and technical development front. Post-independence, Nehru’s visit to Germany paved the way for establishments of Indian Institute of Technologies (IITs).
  • Trade and commerce: Germany is the largest trade partner in Europe and has a share of around 3% FDIs in Indian market. German trade with India, the world's second-most populous country with nearly 1.4 billion people, was less than 10% of its trade with China in 2021.
  • Strategic importance: Germany considers India as one of the alternative to Chinese dominance in the south Asian region.
  • Military and security cooperation: India is a central partner for German and European foreign policy in the Indo-Pacific. From the long-term perspective, it is considered the only coun­try that could demographically and eco­nomically counterbalance China in the Indo-Pacific. 

Germany was the second country after France to come forward with an Indo-Pacific strategy.

Key-takeaways from the Meeting

Germany and India signed a series of bilateral agreements 

  • Germany committed to provide additional support worth euro 10 billion to India by 2030 to support green growth initiatives.
  • India and Germanyalso agreed to work together on joint projects in third countries in an apparent signal to counter China’s debt-driven infra financing model.
  • India and Germany would be signing a migration and mobility agreement to facilitate two-way movement of students, professionals and researchers while addressing the challenges of illegal migration.
  • Both the governments agreed to support each other’s efforts to expand the internationalisation of their higher education systems, interlinking further the innovation and research landscapes of both countries, and strengthening dual structures for vocational education and training.
  • EU-India Trade and Technology Council: EU-India Trade and Technology Council. The decision to set up a Trade and Technology Council will be the first for India with any of its partners and second for the European Union following the first one it has set up with the US.
  • Green and sustainable developments: India and Germany both have agreed to navigate into the new pathways for green development and clean energy. Indo-Germany cooperation in green development will be guided by the commitments made under Parish Agreement and SDGs.
  • International Trade and WTO: both the nations have promised to cooperate at WTO for its reform along with preserving the autonomy of two-tier appellate tribunal. Open, inclusive, free and fair trade are the shared objectives of the two nations.
  • India –EU FTA: Germany has agreed to negotiate at EU for India-EU Free Trade Agreement.
  • Countering tax evasion: Shared commitments in OECD Framework for Base Erosion and Profit Shifting to counter the tax evasions by multinational companies.
  • Health collaboration: Both the nations have emphasized on ensuring security of medical supply chains, strengthening global preparedness for health emergencies and reducing future zoonotic risks, taking a One-Health-Approach.
  • Security Domain: Countering terror financing and money Laundering both have agreed to work upon the Joint Comprehensive Plan of Action. Secure and safe cyber space are the major focused domain in the new technological revolution.
  • Humanitarian crisis: both have agreed to respect the international rule and respect the territorial integrity and sovereignty of every nation, and protect the rights of the civilians. Peace and prosperity should be maintained by the nations.
  • Other shared values at multilateral cooperation: India and Germany both have agreed strengthen ties at multilateral and regional level for effective and purposive reforms:
    • UNSC reform to make more purposive and reflective of contemporary issues.
    • Free, open and inclusive Indo-Pacific region.
    • Preserving the centrality of the ASEAN in the region
    • India at G7: Germany has welcomed the step to invite India in the G7 summit.

How these agreements benefit India?

  • Green Initiatives: At the climate change and green development initiative India will be get the impetus and technological support, which will help to achieve the targets of SDG and Paris agreement.
  • Waste management and circular economy: Swacch Bharat Abhiyaan initiated by India on the principles of clean India will get a supporting hand to improve the infrastructure for waste management system and diversify the system into a circular economy.
  • Rural and Agro economy: Collaboration in the agricultural front will give a scope for Indian farmers to diversify their source of income and promote a sustainable agro economy.
  • Trade and taxation: Framework under OECD to prevent BEPS will give a boost to the revenue collection from the multinational companies. Diversification of supply chain and markets have the potential to provide a broader base for supply and wide market accessibility to provide a safe cushion to any unpredictable international shocks.
  • Smart City Initiatives: Policy framework for Sustainable Smart City and proper implementations for the projects to avoid and mitigate the diastral risk will be assisted by the German Expertise.
  • Representation at Multilateral and international forums: India’s invitation to the G7 summit is has been welcomed by the Germany which gave a High Ministerial position to India at International Forum. Collaboration at UNSC will provide a support to get a better representation.

What shall be done more?

  • Data Security and Protection: India should follow and maintain the data security measure in accordance with European standards to have safe and secure line for digital cooperation.
  • Trade policy measure: More inclusive and transparent policy to be ensured to get the benefits of foreign investors and securing the interests of the domestic investors.
  • Regional Cooperation: India’s foremost focus should be strengthening regional cooperation like BIMSTEC to secure the strategic position the region.
  • Dispute resolution and arbitration: India should look upon its dispute resolution and arbitration process and make it more effective and responsive.

Conclusion

India Germany shares historical ties since independence on the field of skill developments and technical institution. Though India and Germany have a strong strategic partnership, in the new contemporary issues of geo politics it’s become mandatory to reframe the partnership structurally. Inter-Governmental Consultation in which India has participated and co-chaired the council with Germany has paved a new path for comprehensive and inclusive ties. From territorial space to cyber space both the nations shared the common interest of safe and security respecting the international law and sovereignty of every nation. Peace and stability with clean environment are necessary conditions for the human development and human rights.

Practice Question

Q1. Indo-German Strategic Partnership is based on the common values and principles. Discuss how Indo-German collaboration on various geo-political and economic issues can help create a mutually beneficial partnership for both the countries.

Q2. Ties between India and Germany have been strengthening over the years but there is still vast potential that remains untapped. Comment. 

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