By Prashansa Srivastava
The 14th India-EU Summit began in New Delhi on 6th of October, 2017. Prime Minister Narendra Modi along with the top EU leadership deliberated extensively on bilateral, regional and international issues. They also evaluated the implementation of EU-India agenda for action 2020 covering issues pertaining to trade, investment, security, human rights, environment, climate change and refugees.
India and EU signed three agreements following talks related to investment in science and technology, infrastructure and maritime security namely European Commission and the Science and Engineering Research Board (SERB) for Indian researchers hosted by the European Research Council grantees in Europe; finance contract of Bengaluru Metro Rail Project Phase-2-Line R6 for 300 million euros out of total European Investment Bank (EIB) loan of 500 million euros; and a joint declaration to expand maritime security.
There is a long and rich history of bilateral engagements between the EU and India with this year marking 55 years of diplomatic relations. The formation of the EU-India Strategic Partnership in 2004, contributed to a high degree of advancement in bilateral ties between the two economies.
The EU is the largest destination for Indian exports and a key source of investment and technologies. This 28-nation bloc is India’s largest regional trading partner with bilateral trade in goods standing at USD 88 billion in 2016. India received approximately USD 83 billion of foreign direct investment from Europe between 2000 and 2017, constituting almost 24 percent of the total FDI inflows into the country during the period.
Is economic cooperation only a distant dream?
However, evident inequalities persist, India is only the ninth largest trading partner for the EU. A free trade agreement has been stalled since 2007. The EU and India also clash on issues such as labour laws and climate change. EU’s series of uncomfortable demands on India in recent years such as reduction in carbon emission, improved labour laws and the protection of human rights has also created a gulf between the two.
Various international human rights groups have also been pressurising the EU leadership not to overlook the alleged violation of fundamental human rights of minorities and marginal groups in India while trying to expand its economic cooperation. Before the last India-EU Summit, Human Rights Watch had written an open letter to the EU leadership expressing grave apprehensions over the Modi government’s dismal record on issues like freedom of speech, minority rights, and protection of refugees.
Stalled agreements and new agreements
Launched in June 2007, the negotiations for the proposed EU-India Broad-based Trade and Investment Agreement (BTIA) have witnessed many hurdles with both sides having major differences on crucial issues such as intellectual property rights and duty cut in automobile and spirits. Negotiations reached an impasse with India demanding improved market access in services, and the EU seeking further liberalisation in insurance, banking and multi-brand retail sectors.
In a global economic climate of falling demand and competitive currency devaluations, a free trade agreement would be beneficial to both parties. However conflicting demands have once against deadlocked the agreement. India must address data protection issues and assure the EU of its data security. Only then can trade and investment ties be deepened further.
Looking at the brighter side
Both the EU and India agreed to step up cooperation in countering violent extremism and radicalization, particularly online, and in enhancing maritime security in the Indian Ocean and beyond. The two sides also discussed the refugee crisis involving more than 500,000 Rohingya Muslims fleeing from violence in Myanma and called for a de-escalation of tensions and their voluntary return home in safety and dignity. There was also convergence on increasing cooperation in developing smart cities and upgrading urban infrastructure besides science and technology.
More pertinent efforts must be made to overcome the obstacles hindering the stalled agreements and ensure the expansion of mutual goals and present agreements. As the world’s two largest democracies, it is now time for Europe and India to join hands and foster ideas of free trade, scientific and technological innovation and agreements that are not only economically beneficial but also environmentally sustainable.
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