India relations with European Union

India relations with European Union

The 1994 EU-India Cooperation Agreement provides the legal framework for EU-India relations. Since 2000, regular Summits have boosted political, economic and sectorial cooperation underpinned by the formation of the EU-India Strategic Partnership in 2004.

At the 14th EU-India Summit, held in New Delhi on 6 October 2017, the President of the European Council, Donald Tusk, the President of the European Commission, Jean-Claude Juncker and the Prime Minister of India, Narendra Modi reviewed progress of the bilateral relationship and enabled the strategic partnership to take a significant step forward in view of international and regional challenges. The Summit adopted a comprehensive Joint Statement, and 3 joint declarations – on counter-terrorism, on clean energy and climate change and on a partnership for smart and sustainable urbanisation. Leaders took stock of the implementation of the comprehensive EU-India Agenda for Action 2020 adopted at the 2016 Summit – a roadmap with practical actions for the next five years.

Regular parliamentary exchanges help to promote understanding and deepen the EU-India partnership. In February 2017 a visit of three different committees from the European Parliament to India took place and in spring 2018 the Indian Parliament re-established the India-European Union Parliamentary Friendship Group.

Foreign Policy and security cooperation

The EU and India discuss foreign policy and security matters in a number of fora and at various levels, including at the Summits. Regular ministerial-level meetings help to move forward the implementation of the Summit conclusions and steer the cooperation. Regular foreign policy and security consultations represent a useful platform to exchange views on the full spectrum of bilateral, regional and global foreign policy issues. Security dialogues or consultations are regularly held on counterterrorism, counter-piracy, cyber-security, and non-proliferation/disarmament. To support these, a series of events are held, for example a Workshop on Countering Online Radicalisation in May 2018 to exchange best practices.

Trade and Investment

The EU is India’s largest trading partner, accounting for 13.2% of India’s overall trade, ahead of China (11.6%) and the United States (9.6%). India is the EU’s 9th largest partner, with the value of EU exports of goods to India amounting to €41.7 billion in 2017. The total value of EU-India tradein goods stood at €85.8 billion in 2017. Major EU exports to India include engineering goods (37%), gems and jewellery (16.8%) and chemical and allied products (10.4%). The primary EU imports include textiles and clothing (17.8%), chemical and allied products (14.1%) and engineering goods (15.2%).

Bilateral trade in commercial services has almost tripled over the past decade, increasing from €10.5 billion in 2005 to €28.8 billion in 2016. In 2016 the EU exported services worth €13.5 billion (top three sectors: ICT, transport and travel), while it imported €15.3 billion (top three sectors: business services, ICT and travel).

Overall, the EU is the second largest investor in India, with €70 billion of cumulative FDI from April 2000 to March 2017, accounting for almost one-quarter of all investments flows into India. The EU is also key destination for Indian foreign investments. The EU was the third largest recipient (€3.2 billion) of Indian FDIs, after Singapore and Mauritius, in 2016-17.

Given the significant untapped potential in EU-India trade, the two parties have been negotiating an ambitious Free Trade Agreement since 2007, covering, inter alia, effective market access in goods, services and public procurement, as well as a framework for investment including investment protection and rules that frame trade, such as intellectual property and competition. In 2013 the negotiations were put on hold as there was not sufficient progress on key outstanding issues that include improved market access for some goods and services, government procurement, geographical indications, sound investment protection rules and sustainable development. Since the EU-India Summit in October 2017, both sides have engaged actively in technical discussions on key issues in order to assess whether to relaunch the negotiations.

Comprehensive sectoral cooperation and contacts between people

The EU and India share a number of interests across a range of policy areas, including energy and climate change; environment; research and innovation; pharmaceuticals; biotechnologies; agriculture, Digital economy and Society; competition policy; macroeconomic issues, sustainable urban development; migration and mobility; and higher education. This is reflected in the breadth and depth of EU-India bilateral contacts, which take place in a number of fora and at various levels, including decentralised cooperation between EU and Indian cities. Policy cooperation and dialogue between EU and India in these areas are further enriched and translated into operational cooperation with the help of EU’s Partnership Instrument.

The EU and India remain close partners in the G20 context and have developed a regular macroeconomic dialogue to exchange experience on economic policies and structural reforms.

India has rapidly growing energy needs due to a growing GDP and population and a huge energy infrastructure deficit. India is focussing on domestic production, including renewables and nuclear, and on energy efficiency. EU-India energy cooperation was considerably strengthened over the past years, which led to the launch of an EU – India Clean Energy and Climate Partnership. The partnership brings together, in a joined-up approach, the EU and its Member States, EU and Indian institutions, businesses and civil society. The aim is to jointly implement concrete projects, to promote access to and disseminate clean energy and climate friendly technologies and encourage research and development. An Energy Panel meets annually at senior officials’ level and an energy security working group was launched in 2016. Working groups on various energy sectors are active, including on renewable and energy efficiency. Energy cooperation is thus ongoing on a broad range of energy issues, like smart grids, energy efficiency, offshore wind and solar infrastructure, and research and innovation. India was a key player in achieving a global climate agreement in Paris in December 2015.

India, recognising the importance of fusion energy research in its long-term energy security, participates, with the EU, US, China, Russia, Japan and South Korea, in the international ITER fusion project. ITER is a pioneering project to build and operate an experimental facility to demonstrate the scientific viability of fusion as a future sustainable energy source. Bilaterally the EU and India cooperate under a Euratom Cooperation Agreement on Fusion Energy Research, focussing on projects (20 are ongoing) supporting the success of ITER and the future construction of a fusion electricity demonstration facility (DEMO).

Regarding environment and water, the 2016 Summit launched an EU-India Water Partnership, which was followed by a Memorandum of Understanding. The EU and India also cooperate closely on the Indian Clean Ganga initiative and deal with other water-related challenges in coordinated manner. The EU works in a ‘joined-up’ approach, involving Member States, water authorities, business and NGO’s. Discussions also take place in a Joint Working Group on Environment and an India-EU Environment Forum, along with business, academia and civil society. The dialogue focuses increasingly on global environmental issues including the transition to a green economy as well as emerging issues such as air quality.

The EU has provided longstanding support to Indian cities to develop plans for sustainable development, transport, industry, water and waste management, and more recently established city-to-city cooperation between European and Indian cities such as Mumbai, Pune and Chandigarh in a first phase and twelve more cities involved in the current phase. The EU is also providing support to Indian cities to join the Global Covenant of Mayors on climate and clean energy. This cooperation is being formalised in an India-EU Partnership for Smart and Sustainable urbanisation, which will support the Indian ‘Smart cities’ and ‘AMRUT’ initiatives and will involve EU Member States for policy cooperation, business solutions and joint research & innovation.

The EU and India enjoy strong cooperation in the areas of research and innovation. Regarding academic collaboration in particular, the EU is India’s leading partner in terms of joint publications. Following the conclusion of the EU-India Science & Technology Cooperation Agreement in 2001 (renewed in 2015 until 2020), India became a very active participant in the EC Framework Programmes for Research and Innovation.  Participation in research and innovation funding programme ‘Horizon 2020’ (2014-2020) benefits from a co-funding mechanism agreed with the Indian Department of Science and Technology (DST), the Department of Biotechnology (DBT) in 2016 and most recently with Ministry of Earth Sciences (MoES) in 2018.  Individual Indian researchers can receive grants from the European Research Council (ERC) or the Marie Skłodowska-Curie Actions (MSCA). At the India-EU Joint Steering Committee (June 2017, Brussels) and confirmed at the EU-India Summit in October 2017, it was agreed to upscale the collaborative research through joint calls. Both the EU and India are also looking at ways to enhance the innovation partnership by creating, amongst others, network events where start-ups from India and Europe can meet. An Implementing Arrangement (IA) between the EC and the Indian Science and Engineering Research Board (SERB) was signed allowing for short term cooperation between SERB grantees and ERC teams in Europe.




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