India’s 6-Point Plan to Strengthen Economic Ties with the EU

Syllabus: GS2/ International Relation

In Context

• India has unveiled a 6-point plan aimed at fostering a stronger economic partnership with the European Union (EU). 

About the 6-Point Plan

• Trusted Partnership: Strengthen economic ties to create unprecedented opportunities for a combined population of 2 billion.
  • Build a foundation of trust for sustained cooperation.
• Fair Trade Agenda: Develop a mutually beneficial Free Trade Agreement (FTA) to reduce tariff and non-tariff barriers.
  • Ensure benefits for small enterprises, farmers, and fishermen, enhancing equitable trade practices.
• High-Quality Production: Adopt EU best practices to harmonize standards and achieve “zero defect, zero effect” manufacturing, focusing on quality and sustainability.
• Technological Collaboration: Jointly develop cutting-edge technologies and strengthen critical raw material supply chains.
  • Enhance resilience against non-market economies and promote fair practices in technology sharing.
• Sustainable Development: Align trade with sustainable development goals under the principle of common but differentiated responsibility.
  • Cooperate in renewable energy, green technologies, and environmental protection.
• Mutual Growth: Leverage India’s talent pool to act as a “living bridge” for mutual development.
  • Enhance cultural and economic exchanges to boost innovation and shared prosperity.

India-EU Relations: An Overview

• Political Cooperation: Relations date back to the 1960s, with a significant boost from the 1994 cooperation agreement.
  • Key milestones: 2000: First India-EU Summit.
  • 2004: Upgraded to a Strategic Partnership at the 5th India-EU Summit in The Hague.
• Economic Cooperation: Bilateral trade reached USD 137.41 billion (2023-24), making the EU India’s largest trading partner in goods. Bilateral trade in services was USD 51.45 billion (2023).
• Water Management: The India-EU Water Partnership (IEWP), established in 2016, enhances frameworks in water management.
• Nuclear Energy: Agreement in 2020 for R&D cooperation on peaceful uses of nuclear energy.
• Trade and Technology Council (TTC): Established in 2023 to promote collaboration on trade, technology, and security.

Challenges in India-EU Collaboration

• Legacy Trade Issues: Persistent disputes over tariffs, non-tariff barriers, and standards harmonization.
• Technology Transfer: Challenges in aligning intellectual property rights (IPR) and ensuring fair sharing of technology.
• Critical Raw Materials: Geopolitical tensions and competition hinder securing vital resources for both parties.

Way Forward

• Accelerate FTA Negotiations: Focus on resolving issues related to market access, trade facilitation, and dispute resolution.
• Enhanced R&D Partnerships: Establish joint research centers and innovation hubs to drive technological collaboration.
• Sustainability Focus: Invest in green technologies and renewable energy to achieve long-term environmental and economic benefits.

Conclusion

• India’s 6-point plan offers a robust roadmap for deepening India-EU relations, addressing critical issues like trade, technology, and sustainability. By leveraging complementary strengths and addressing existing challenges, this partnership can play a transformative role in fostering global economic stability and resilience.

Source: TH