cer -是时候升级欧盟与印度的关系了 It's time to upgrade the EU-India relationship 20250205

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It’stimetoupgradetheEU-Indiarelationship

byAnunitaChandrasekar,7February2025

TheEU’snewleadershipteamallagreethatrelationswithIndiashouldbeapriority,andboth

sidesstandtogainbydeepeningco-operation.Renewedgreatpowercompetitionshouldgivetherelationshipafreshimpetus.

IndiaisclearlyontheagendaofthenewEUteam.UrsulavonderLeyen’s

announcement

onJanuary21stthatthefirsttripofhernewtermwouldbetoIndia,

accompanied

bythefullcollegeofCommissioners,buildsonher2022

statement

thattherelationshipwithIndiawasoneoftheUnion’s“mostimportantforthecomingdecade”.ThiswasechoedearlierthismonthbyEuropeanCouncilPresident,AntónioCosta,

whenhe

described

IndiaasoneoftheEU’smainglobalpartnersandsaiditwastimetoboostrelations

and“engageinanewstrategicagenda”.Additionally,inherconfirmationhearing,EUHighRepresentativeforForeignAffairsandSecurityPolicyKajaKallastoldtheEuropeanParliamentthattheEU’srelationswithIndiahad“somuchunexploredpotential”.

Butdespitethewarmrhetoric,theEU-Indiarelationshipiscurrentlymuchthinnerthanitcouldbe.IndiahasseentheEUasatradeblocratherthanapoliticalactor,andhasfocusedondevelopingbilateral

relationswithmember-states,whilstseniorEUofficials,speakingprivately,haveacknowledgedthat

“EuropeknowstoolittleaboutIndia”.In2018theEUreleasedanembryonic

strategy

,‘Elementsforan

EUstrategyonIndia’.However,thislackedthestrategicclarityoftheEU’s2019jointcommunicationon

China,withitstriptychof‘partner,competitor,systemicrival’,andtheCommission’scallforamorejoined-upEuropeanapproachremainsunanswered.EU-Indiarelationsarecurrentlygovernedbya

'roadmap

'

which,thoughbroad,containslittlethatisoperationalandisduetoberenegotiatedin2025.Shared

concernsaboutdependenciesonChinaandanincreasinglypolarisedworldshould,however,pushbothpartiestotrytoovercometheobstaclestocloserco-operation.

BothEuropeandIndiahaveasharedinterestinmaintainingabalanceofpowerinanIndo-PacificregionincreasinglyshapedbyChina.TheEUispayingmoreattentiontotheregion,resultinginthelaunch

ofEuropeanstrategieson

connectingEuropeandAsia

andonthe

Indo-Pacific

moregenerally.India’s

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ambitiousdomesticagendaofsustainablemodernisationanddevelopmentdovetailswithseveralof

Europe’sforeigneconomicpriorities,andboththeEUandIndiaareseekingtoreducetheirdependenciesonChinainareassuchascriticalminerals.IndiacouldplayaroleinhelpingEuropetoderiskanddiversifysupplychains,inlinewiththecallinthe

Draghireport

foraEuropeanforeigneconomicpolicy.These

clearlyconverginginterestscouldovercomepotentialdivergencesonaspectsoftradeandforeignpolicy.

India’sgrowingglobalimportance

Indiahasgrownrapidlytobecometheworld’sfifth-largesteconomyintermsofpurchasingpowerparity–projectedtobecometheworld’sthird-largestby2030–andalsotheworld’smostpopulousnation,onthecuspofademographicdividendintheformofaworkingagepopulationofaroundonebillionby

2030.However,inPPPtermspercapitaGDPlanguishesat122ndintheworld.Thegovernment’s‘MakeinIndia’seekstoturnIndiaintoamanufacturinghubtorivalChina,withthegoalofreaching$2trillionintotalexportsby2030,almostfivetimesthe2023totalof$432billion,whilstViksitBharat(‘DevelopedIndia’)aimstomakeIndiaadevelopednationanderadicateextremepovertybythecentenaryofIndianindependencein2047.

Indiaiskeentoplayalargerglobalroleandengagesconstructivelywithadiverserangeofpartners,

rangingfromtheUS,theEUandIsraeltoRussiaandIran,includinginvariousminilateralandmultilateralformats.Ontheonehand,itisamemberofgroupingssuchasthesecurity-focusedQuadwithAustralia,theUSandJapan,andtheI2U2,whichconsistsofIndia,Israel,theUAEandtheUS,andfocuseson

increasingeconomicco-operation.Ontheotherhand,IndiaisalsoinvolvedinformatssuchasBRICSandtheShanghaiCo-operationOrganisation,inbothofwhichChinaandRussiaareprominent.However,

Indiawantssuchgroupingsto

remain

‘non-Western’ratherthan‘anti-Western’.

Furthermore,NewDelhiisactivelyadvancingIndia-ledsolutionstoglobalissues.AgoodexampleofthiswasthelaunchoftheambitiousIndia-MiddleEast-EuropeEconomicCorridor(IMEC)onthesidelines

ofthe2023G20summitinNewDelhi.ThiswouldconnectIndiatoEuropeviatheGulfStates,IsraelandJordanandavoidtransportchokepointssuchastheSuezCanalortheRedSea.IndiaalsouseditsG20presidencytoamplifyitsroleasa'voiceoftheGlobalSouth'andgivegreaterprominencetosolutionsithasdevelopedtosomeoftheissuesitbelievesarecrucialtoGlobalSouthcountries,oneofwhichisdigitaltransformation.

India’sindigenouslydeveloped

DigitalPublicInfrastructure

solutionshavefacilitatedthedigitalisationofthecountry,creatingbiometricidentitiesandsecureplatformsfordigitalpayment,andcouldpotentiallyboostGDPby2.9–4.9percentby2030.NewDelhihascapitalisedonitsknowledge,signingagreementsondigitaltransformationwithcountriessuchasArmenia,Colombia,KenyaandTanzania.ForEurope,

India’sengagementwiththeGlobalSouthcouldoffervaluableopportunitiesfortrilateralco-operationonsharedpriorities,includingsourcingandprocessingcriticalmineralsinregionsofincreasingstrategicsignificance,suchasCentralAsia.

Foreignpolicydivergencesandconvergences

IndiaseesRussia–asthesuccessortotheSovietUnion–asahistoricalallyandkeysupplierofdefenceequipment.ButitsrefusaltocondemnRussia’sinvasionofUkraineanditsburgeoningimportsofRussianoilhavenotcausedasignificantriftwithEurope.Ifanything,EU-Indiatieshavetakensomesignificant

stepsforwardssince2022,withtheresumptionoftradenegotiationsandthelaunchofinitiativessuchas

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the

EU-IndiaTradeandTechnologyCouncil

(TTC).TheTTC,launchedin2023,isonlytheUnion’ssecond

afterthatwiththeUS.Ithasthreeworkinggroupscoveringstrategictechnologies,resilientsupplychainsandcleanandgreentechnology,thataimtobringtogetherhigh-levelrepresentativesandexpertsfrombothsides.An

EU-Indiaconnectivitypartnership,

launchedin2022,aimstoincreaseco-operationintheenergy,transportanddigitalsectors.Buttheseinitiativeshaveproducedfewsubstantiveoutcomessofar.

BrusselsseemstohaveconcludedthatthestrategicvalueofEU-IndiarelationsoutweighsdisagreementsoverRussia,andunderstandsthatithaslimitedinfluenceonIndia’sforeignpolicystrategyofmulti-

alignment.NewDelhihasevensoughttouseitsneutralityasanasset,offeringtohostafollow-uptotheinconclusivepeacesummitheldinSwitzerland–amove

welcomed

byUkrainianpresidentVolodymyrZelenskyy.

Untilrecently,fewIndiancompanieshadbeensanctionedbytheEUforhelpingRussiatoobtainsensitiveembargoedgoods,andtherewaslittlecriticismoftheIndiangovernment,evenafterModi’svisitto

Moscowlastyear.ButrecentUSandEU

sanctions

ontheso-calledRussianshadowfleetofoiltankers

haveledtomanyofthembeingturnedawayfromIndia,whichislikelytoreduceMoscow’srevenues.Thisdoesnot,however,meanthatIndiaislikelytodowngradeitsbroaderrelationswithRussia,thoughitis

concernedbythegrowingclosenessbetweenRussiaandChina–astheEUis.UnliketheEU,however,NewDelhiseesitsrelationshipwithMoscowasameanstopreventcompleteRussiandependencyonChina.

LiketheEU,IndiafindsitselfneedingtobalanceitseconomicrelationswithChina,whichisoneofits

toptradepartners,withsecurityconcerns.TensionsinSino-Indianrelationshavepersistedsincedeadlyclashesalongtheborderin2020.Chinawill,nonetheless,remainanimportanteconomicpartnerfor

IndiaandNewDelhiseekstoemulateBeijing’seconomicdevelopment.SeniorIndianadvisers,

backed

bytheFinanceMinister,NirmalaSitharaman,haveeven

called

forNewDelhitoallowmoreChinese

investment–seenasnecessaryforIndiangrowthandmoredomesticallyadvantageousthantrade.

Tradeanditsdiscontents

TradeliberalisationwouldbenefitbothsidesbuthastraditionallybeenasourceoffrictionbetweenBrusselsandNewDelhi.Negotiationsonafreetradeagreement(FTA)weresuspendedfrom2013to2022.Despitethis,theEUhasconsistentlybeenoneofIndia’stopthreetradingpartners(seeChart1)overthepastdecade.Furthermore,inrecentyears,Indiaappearstohaverecognisedthatitcannotsustainitsdomesticgrowthandmeetitsambitiousnetexporttargetswithoutexpandingtradeandinvestmentopportunities.Ithasreconsideredsomeofthemoreprotectionistimpulsesthathave

traditionallymadeitadifficultnegotiatingpartner.

Since2021,Indiahassigneditsfirstbilateralandmultilateraltradeagreementsinalmostadecade.Significantly,thesehavebeenwithAustralia,theUAEandEuropeanFreeTradeAssociation(EFTA)

–partnersoutsideIndia’sneighbourhood.Thoughmorelimitedinscopeandcomplexitythanthe

projectedIndia-EUFTA,withtheAustraliaandUAEagreementslackingchaptersoninvestmentfor

example,theysignalIndia’spotentialopennesstoliberalisingtrade.Prominentgovernment-backed

think-tanksareeven

callingintoquestion

India’srefusaltoengagewithlandmarkagreementssuchasthe2019China-ledRegionalComprehensiveEconomicPartnership–anagreementspanningtheIndo-Pacificthatisworld’slargestfree-tradeareaintermsofGDP–orthe12-nationComprehensiveand

ProgressiveAgreementforTrans-PacificTrade.

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Chart1:ComparisonofiveofIndia’stoptradingpartnersoverthelastdecade

(totalvolumeoftrade,billionsofUSdollars)

600,000

500,000

400,000

300,000

200,000

100,000

0

China

Russia

UAE

EUUSA

2013-142014-152015-162016-172017-182018-192019-202020-212021-222022-232023-24

Source:IndianMinistryofCommerceandIndustrydata2013-2024.

TheEFTAdealisofparticularinterestasitiswithEuropeanpartnersandincludesanunusual

commitment

byEFTAcountriestoincreasetheirFDIinIndiato$100billionandcreate1millionjobsoveraperiodof15years.Whilstthefeasibilityofthisremainstobeseen,itshowsIndia’sappetiteforincreasingEuropeanFDI.TheEUisalreadyoneofIndia’stopthreesourcesofFDI,withitsaggregateinvestmentstockreaching€108.3billionin2022.Sectorsthatstandtobenefitincludeservicesandcomputerhardwareandsoftware,whichtogethermadeuparoundathirdofFDIinflowsin2023-24.

EuropeancompanieswouldhaveanadvantageoverChineseones,asIndiaintroducedrestrictionson

ChineseFDIin2020,makinginvestmentssubjecttogovernmentapproval.StrategicsectorsthatIndiaisalreadycommittedtodeveloping,suchassemiconductormanufacturingandgreenhydrogen,wouldbeopentoEuropeanfirms.

IndiaregardstheEU’semphasisonlabourstandardsandenvironmentalmeasures–suchasCBAM–as

protectionist.ButintheDecember2024dealwithMercosur,whichwasintheworkevenlongerthantheIndiadeal,theEUshowedsomeflexibilityinregardtoclimateobligations,witha'rebalancingmechanism'potentiallyallowingMercosurcountriestochallengeEUenvironmentalmeasuresthatreducethetrade

benefitsoftheagreement.Indiamightbeabletosecureasimilarconcession.AnothercontentiousareaforIndiainanynegotiationisagriculture,whichemploysalmost43-50percentofIndia’slabourforce,almost80percentofwhomaresmallfarmersandwouldbeadverselyaffectedbyanFTA.

Indiaalsowantsmoreopportunitiesforskilledlabourmobility.Brusselscouldhaveavaluablebargainingchipintheformofsimplifiedworkingvisaproceduresorthemutualrecognitionofqualifications,thoughsuchstepsmightjarwithEurope’sincreasinglyanti-migrantsentiment.Nonetheless,member-statessuch

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as

Italy

and

Germany,

despitetheirdesiretoreduceoverallmigration,haveincreasedthenumberofvisasonoffertoskilledIndianworkers,suchasnurses,tofillvacancies.

RecentdevelopmentsonboththeIndianandEuropeansidessuggestthattherecouldfinallybea

breakthroughinnegotiationsandthatanFTAcouldbeagreedwithinthenextfewyears,thoughtherehavebeenfalsedawns

before

.TradecommissionerMarošŠefčovičhas

highlighted

hisintentionto

“contributetodevelopingastrategicEU-Indiaagenda”inhisconfirmationhearingintheEuropean

ParliamentandinarecentmeetingwithPiyushGoyal,theIndianMinisterofCommerceandIndustry,

announced

amutualcommitmenttoa“commerciallymeaningfultradeagenda”.TheEUisproceedingwiththreeseparatesetsofnegotiations–overanFTA,anInvestmentProtectionagreementanda

GeographicalIndicationsagreement–signallingthatitwillnotholdprogressinoneortwoareashostagetoagreementacrosstheboard.

Co-operationbeyondtrade

Evenintheabsenceofagreementstodeepentradeandinvestment,thereisstillscopeforcloserEU-

Indiaco-operationintechnology,combatingclimatechange,educationandskills,aswellasdefenceandsecurity.Thealready-establishedTTCcouldbeusefulindrivingrelationsforwardandthefocusshould

beonresearchandinnovation,andcollaborationbetweenstart-upsincriticalsectorssuchasquantumcomputing,EVbatteriesandsemiconductormanufacturing,atopiconwhichtheEUhasalready

signed

anagreementwithIndia.Additionally,thoughmigrationisacontentiousissue,EuropecanstillhelpIndiacapitaliseonitsyouthfulpopulationthroughco-operationondevelopingskills,especiallyincutting-

edgefields.

Indiaistheworld’sthird-largestcontributortogreenhousegasemissionsandmeetsaroundhalfofitscurrentenergyneedswithcoal.Ithasambitiousplanstocutitscarbonemissionsinhalfby2030whilststrivingtobecomeanetexporterofgreenhydrogenandbolsteritssolarandwindcapacities.EuropecouldhelpIndiameetthesetargetsandpotentiallyevenbenefitfromIndiabeinganetexporterof

greenenergy.

Whenitcomestodefenceandsecurity,EuropeandIndiahaveconverginginterestsintheIndo-Pacific.Thelaunchof

securityanddefenceconsultations

and

maritimesecuritydialogues

inthelastfewyearsreflectthis,andthereisscopetoincreasehigh-leveldialogue.India,responsiblefortheworld’slargestshareofglobalarmsimports,couldalsobecomeanimportantcustomerforawiderrangeofEuropeandefencefirms.ThesecouldbothreduceNewDelhi’sdependenceonRussia,whoseshareofIndian

armsimportshasalready

decreased

from76percentto36percentbetween2009and2023,andhelpEuropeanfirmsmaintainapipelineoforders.Ultimately,however,thiswillcontinuetodependon

individualmember-states.France,alreadyIndia’ssecondlargestsupplierofarmsafte