Indo-German Relations

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    In News

    • Recently, German Chancellor Olaf Scholz came to India on a bilateral visit.

    About

    • The German chancellor’s visit assumes significance 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

    Key outcomes of the bilateral meeting     

    •  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-Germany agreed on a vision statement to Enhance Cooperation in Innovation & Technology.
      • Under the framework of the Inter-Governmental Agreement on ‘Cooperation in Scientific Research and Technological Development’, the two countries share a long history of cooperation in science and technology, research and innovation.
    •  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.      
    • Both sides concluded agreements on “Digital Transformation, FinTech, IT, Telecom and Supply chains’ diversification”.

    Indo- German Ties

    • About:
      • 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 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 which 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.
        • During the last IGC in may 2022 following several agreements were signed
          • Green and Sustainable Energy Partnership
          • Agro-Ecology Cooperation
          • Triangular Development Cooperation Projects in Third Countries
      • A Track 1.5 Strategic Dialogue has also been established to enhance mutual understanding of national, regional and strategic interests.
    • Defence co-operation:
      • India-Germany Defence Cooperation Agreement (2006) provides a framework for bilateral defence cooperation.
      • Both the countries signed the Arrangement on Implementation of the Agreement, concerning Bilateral Defence Cooperation which enables both the 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: Germany’s trade with India is less than ten percent of its trade with china.
    • Restrictive Policies: Germany has an advanced defence manufacturing  comparable to that of france, but the defence exports are less than potential because of restrictive arms export policy
    • Lack of a separate bilateral investment treaty between the two countries hampers the commercial potential between two countries. 
    • Germany is not confident  about India’s trade liberalization measures, it bats for more liberal labour regulations.

    Way Forward

    • With more than 20% of German trade conducted in the Indo-Pacific neighbourhood and India’s centrality in the Indo-Pacific, strong ties between the countries are mutually beneficial.

    Source:TH