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India-European Commission Partnership

Last updated on April 1st, 2025 Posted on February 28, 2025 by NEXT IAS Current Affairs Team  457

Syllabus: GS2/International Relations

Context

  • Recently, a delegation led by European Commission (EC) President Ursula von der Leyen is in India for a two-day visit exploring a ‘security and defence partnership’.
European Commission (EC)
Historical Background
– It traces its origins to the formation of the European Economic Community (EEC) in 1958, following the Treaty of Rome.
– The Maastricht Treaty (1993) and the Lisbon Treaty (2009) further strengthened its powers, ensuring that it remains a key player in EU governance.
Structure and Composition
– The European Commission (EC) is the executive arm of the European Union (EU), which is based in Brussels, Belgium, and operates independently from the national governments of EU member states.
– EC is composed of 27 Commissioners, one from each EU member state, are appointed for a five-year term.


Key Components
– President of the Commission: It is nominated by the European Council and approved by the European Parliament.
1. Sets the overall political agenda of the Commission.
2. Appoints Vice-Presidents and assigns portfolios to Commissioners.
Commissioners (College of Commissioners):
1. Each member state nominates one Commissioner.
2. Responsible for different policy areas such as trade, environment, and competition.
– Directorates-General (DGs) and Services: These departments function like ministries and are responsible for drafting policies and implementing laws.
– High Representative for Foreign Affairs and Security Policy:
1. Oversees the EU’s diplomatic and security policies.
2. Serves as Vice-President of the Commission.
Functions of the European Commission
– Legislative Initiative;
– Enforcement of EU Laws;
– Policy Implementation and Budget Management;
– International Representation;

About India-European Commission (EC) Partnership

Historical Context:

  • 1962: Diplomatic relations between India and the European Economic Community (EEC), the precursor to the European Union;
  • 1994:  Signing of the India-EU Cooperation Agreement;
  • 2004: Strategic Partnership, a shift towards deeper collaboration in trade, security, and global governance. 
  • 2020: ‘India-EU Strategic Partnership: A Roadmap to 2025’, outlining ambitious goals for cooperation in various sectors, including digital innovation, climate action, multilateralism, and global peace.

Economic Cooperation:

  • Trade: The EU is one of India’s largest trading partners, accounting for nearly 11% of India’s total trade, and the USA (10.8%) and China (10.5%).
    • As of 2023, bilateral trade between India and the EU reached approximately €120 billion.
    • The EU is the second-largest destination for Indian exports (17.5% of the total) after the USA (17.6%), while China only ranks fourth (3.7%).
  • Investment and Business Ties: The EU is one of the largest foreign investors in India, with cumulative FDI inflows of over $100 billion in sectors such as automobiles, renewable energy, and information technology.
  • Supply Chain Resilience: Both are focusing on diversifying supply chains, particularly in semiconductors, pharmaceuticals, and critical minerals.
  • Free Trade Agreement (FTA) Negotiations: The India-EU Free Trade Agreement (FTA), officially known as the India-EU Broad-Based Trade and Investment Agreement (BTIA), has been under negotiation since 2007.
    • It aims to enhance market access, reduce tariffs, and streamline trade regulations.

Strategic and Security Cooperation:

  • Maritime Security: EU’s Global Gateway Strategy and India’s Indo-Pacific Strategy are working together to ensure free and open sea lanes in the Indian Ocean and the Indo-Pacific region.
  • Counter-Terrorism: The India-EU Counter-Terrorism Dialogue facilitates intelligence-sharing and counter-radicalization measures to combat terrorism and cyber threats.
  • Defense Cooperation: The EU and India are exploring deeper defense collaboration, including joint military exercises, cybersecurity cooperation, and technology-sharing agreements.

Climate Change and Sustainable Development:

  • India-EU Clean Energy and Climate Partnership: Focuses on renewable energy, energy efficiency, and green financing.
  • International Solar Alliance (ISA): The EU actively supports India’s ISA initiative, which aims to promote solar energy deployment worldwide.
  • EU-India Green Hydrogen Partnership: Aims to accelerate the use of green hydrogen in industrial sectors to reduce carbon emissions.

Technology and Digital Transformation:

  • India-EU Digital Partnership: Focuses on 5G, artificial intelligence (AI), and cybersecurity to enhance digital connectivity.
  • Data Protection and Privacy: India and the EU are discussing frameworks to align data protection laws, ensuring a secure digital ecosystem.
  • Research and Innovation: India’s participation in Horizon Europe, the EU’s flagship research program, fosters collaboration in space, biotechnology, and health sciences.

Geopolitical and Multilateral Engagement:

  • G20 (India hosted the G20 Summit in 2023 with strong EU participation);
  • United Nations (India supports EU’s role in global governance);
  • World Trade Organization (WTO) (Both advocate for fair trade practices);

Challenges in the India-EU Partnership

  • Trade Barriers: Tariff and non-tariff barriers, particularly in the agriculture, automotive, and pharmaceutical sectors, have slowed FTA negotiations.
  • Human Rights and Labor Standards: The EU has raised concerns over labor rights, environmental standards, and digital governance in India.
  • Geopolitical Divergences: India’s neutral stance on the Russia-Ukraine war has led to some diplomatic tensions with EU nations.
  • Regulatory Hurdles: Differences in data privacy laws, intellectual property rights (IPR), and digital taxation require further negotiation.

Future Prospects

  • Expansion of India’s role in EU-led global initiatives, including the Global Gateway and climate financing projects.
  • Conclusion of the India-EU Free Trade Agreement in the coming years.
  • Enhanced defense cooperation, including joint defense production.
  • Stronger collaboration in space technology and AI-driven innovation.
  • With both sides committed to deepening their strategic alliance, the India-EU partnership aims to play a crucial role in shaping the global economic and security landscape in the decades ahead.

Source: IE

 
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