German Chancellor Olaf Scholz recently visited India on a bilateral visit. The visit is significant as it coincides with the completion of one year of the Russia-Ukraine conflict and comes after the recent Chinese spy balloon episode that has created ripples in world geopolitics.
During the visit, both countries had discussions on economic cooperation, the Green and Sustainable Development Partnership (GSDP), and Indo-Pacific. The key outcomes of the bilateral meeting are as follows:
Green and Sustainable Development Partnership (GSDP):
GSDP is an umbrella partnership that provides political guidance and steer to robust ties in climate action and SDGs. Under this, Germany will place €10 billion in new and additional commitments under their development cooperation portfolio in India. India and Germany agreed on a vision statement to Enhance Cooperation in Innovation & Technology.
Cooperation in Green Hydrogen:
For this, the Indo-German Green Hydrogen Task Force was constituted in September 2022.
Triangular Development Cooperation:
India and Germany agreed to work on development projects in third countries.
Indo-German Ties:
India-Germany cooperation aims at benefiting humanity and is firmly guided by their shared democratic values and respect. India-Germany relations rest on a very strong pillar of trade and investment linkages. India and Germany have had a ‘Strategic Partnership’ since May 2000. This has been further strengthened with the launch of Intergovernmental Consultations (IGC) in 2011. The G4 nations (Brazil, Germany, India, and Japan) support each other’s bids for permanent seats on the United Nations Security Council.
Trade and economic relations:
Germany is India’s largest trading partner in Europe, with a total trade of USD 21.07 Billion in 2020-21, occupying 17.4% of share in the European Market. Germany is the 7th largest foreign direct investor in India since April 2000. Germany’s total FDI in India from 2000 until 2019 amounted to US$ 11.9 billion. Germany has a Bilateral Trade and Investment Agreement (BTIA) with India via the EU.
Institutional Relationship:
The Intergovernmental Consultations (IGC) is a unique mechanism that brings together ministers and officials from both sides, to engage in bilateral discussions on cooperation and partnership across a range of areas. The focus areas for the IGC included global security policy issues and common efforts to tackle the climate crisis.
Defence co-operation:
India-Germany Defence Cooperation Agreement (2006) provides a framework for bilateral defence cooperation. Both countries signed the Arrangement on Implementation of the Agreement, concerning Bilateral Defence Cooperation, which enables both countries to share classified information with each other. Indian and German navy ships regularly conduct anti-piracy operations in the Indian ocean. The first-ever Franco-Indian-German military exercise is expected to take place in 2024.
Science & Technology:
Bilateral Science and Technology cooperation is implemented under Inter-Governmental Agreement on ‘Cooperation in Scientific Research and Technological Development’. An apex Indo-German Committee on S&T coordinates the implementation of activities. The jointly funded Indo-German Science and Technology Centre (IGSTC) was set up in Gurgaon in September 2008.
Issues:
Germany’s low trade with India is less than ten percent of its trade with China. Restrictive policies hamper the commercial potential between the two countries, including a lack of a separate bilateral investment treaty between the two countries. Germany is not confident about India’s trade liberalization measures and calls for more liberal labor regulations.
MCQs about Strengthening Indo-German Ties
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What is the total trade between India and Germany for the year 2020-21?
A. USD 11.9 billion
B. USD 21.07 billion
C. USD 32.5 billion
D. USD 45.2 billion
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What is the main aim of the Indo-German Green Hydrogen Task Force?
A. To improve trade relations between India and Germany
B. To work on development projects in third countries
C. To promote cooperation in green hydrogen
D. To enhance cooperation in innovation and technology
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What is the focus of Indo-German Green Hydrogen Task Force?
A. Cooperation in Green Hydrogen
B. Development projects in third countries
C. Digital Transformation
D. Trade and investment linkages
