India-Germany: MoUs on Green Hydrogen, Technology & Trade

Syllabus: GS2/International Relation

Context

• Recently, India and Germany signed multiple treaties, agreements on Mutual Legal Assistance Treaty in Criminal Matters and Indo-German Green Hydrogen Road Map on the 7th India-Germany Intergovernmental Consultations.

About the India-Germany Relations

• India and Germany share a robust and multifaceted relationship, rooted in mutual respect, shared values, and common interests.
• It spans various domains, including political, economic, scientific, and cultural exchanges, reflecting the depth and breadth of their bilateral ties.

Historical Context

• The diplomatic relations between India and Germany were established in 1951.
• Over the decades, these relations have evolved, marked by high-level visits, strategic dialogues, and numerous agreements. 
• The foundation of this relationship is built on shared democratic values, respect for human rights, and a commitment to multilateralism.

Key Highlights of the Agreements

• Green Hydrogen Roadmap: The Indo-German Green Hydrogen Roadmap was unveiled, outlining strategies to promote private sector investment, trade, and export of green hydrogen.
  • It aims to decarbonize hard-to-abate sectors such as steel, refineries, and heavy-duty transport.
• Technology and Innovation: Both nations agreed on a Road Map on Innovation and Technology, which includes joint research and development on advanced materials.
  • It is expected to enhance technological advancements and innovation in both countries.
• Trade and Economic Cooperation: Germany is India’s largest trading partner in the European Union. Germany has a Bilateral Trade and Investment Agreement (BTIA) with India via the EU.
  • The bilateral trade volume has been steadily increasing, with significant investments in sectors like automotive, engineering, chemicals, and renewable energy. 
  • The leaders discussed enhancing bilateral trade, which has already surpassed $30 billion.
  • Germany emphasised the importance of avoiding one-sided dependencies, particularly in strategic areas like critical raw materials and technologies.
• Mutual Legal Assistance and Security: Several treaties were signed, including the Mutual Legal Assistance Treaty in Criminal Matters and an agreement on the exchange and mutual protection of classified information.
  • These agreements aim to strengthen legal and security cooperation between the two countries.
• Strategic Importance: India highlighted its role as a prime centre for diversification and de-risking in global trade and manufacturing, and invited German businesses to invest in India, emphasising the country’s skilled workforce and the increasing number of visas for skilled Indians from 20,000 to 90,000 per year.
  • Germany noted that the free trade agreement between the European Union and India could be finalised in months rather than years.

Other Dimensions

• Political and Strategic Cooperation: India and Germany engage in regular high-level consultations, including the Inter-Governmental Consultations (IGC), which is a unique biennial dialogue mechanism.
  • Both nations reaffirmed their commitment to a rules-based international order and effective multilateralism, addressing global challenges such as climate change, terrorism, and economic recovery post-COVID-19.
  • The G4 nations (Brazil, Germany, India, and Japan) support each other’s bids for permanent seats on the United Nations Security Council.

• Scientific and Technological Collaboration: Both countries collaborate extensively in areas such as renewable energy, environmental technology, and digitalisation.
  • The Indo-German Science and Technology Centre (IGSTC) plays a pivotal role in fostering joint research and innovation projects.
• Cultural and Educational Exchanges: The Goethe-Institut in India and the Indian Council for Cultural Relations (ICCR) in Germany facilitate cultural exchanges, promoting mutual understanding and appreciation.
  • Additionally, educational collaborations are thriving, with numerous Indian students pursuing higher education in Germany, particularly in engineering and technology fields.
• Climate Change and Sustainable Development: Both India and Germany are committed to addressing climate change and promoting sustainable development.
  • However, aligning their approaches and ensuring effective implementation of joint initiatives can be challenging.
  • The Green and Sustainable Development Partnership is a step in the right direction, but it requires continuous effort and cooperation.

Concerns and Key Issues

• Economic Dependencies and Trade Imbalances: There are concerns about trade imbalances, with India often running a trade deficit with Germany.
  • Both countries are working to diversify their economic relations to reduce dependencies, especially in light of global supply chain disruptions.
• Geopolitical Shifts and Strategic Alignments: The geopolitical landscape has been shifting rapidly, particularly with the ongoing Russia-Ukraine conflict.
  • Germany’s strategic pivot, marked by increased defence spending and a reevaluation of its ties with Russia and China, has implications for its relationship with India. 
  • India, while maintaining a neutral stance on the Ukraine conflict, faces pressure to align more closely with Western policies.
• Migration and Mobility: There are ongoing discussions to facilitate easier movement of professionals and students between the two countries.
  • However, regulatory challenges and differing immigration policies can pose significant hurdles.
  • Ensuring a balanced and mutually beneficial migration policy remains a key concern.

Future Prospects

• The MoUs signed between India and Germany mark a new chapter in their bilateral relations, with a strong focus on sustainability, innovation, and economic growth.
• By working together, both nations aim to achieve their common goals of reducing reliance on fossil fuels, decarbonising their economies, and establishing robust green hydrogen economies.

Conclusion

• India-Germany relations are characterised by a deep sense of mutual trust and shared aspirations. 
• As both nations navigate the complexities of the 21st century, their partnership is poised to contribute significantly to global peace, stability, and sustainable development.
• Recent collaboration not only strengthens the strategic partnership between India and Germany but also sets a precedent for international cooperation in addressing global challenges such as climate change and sustainable development.

Source: BL