Germany is looking to expand its presence in India to compensate for a slowdown in China
NEW DELHI: India and Germany pledged on Monday to revive efforts to reach an Indo-European free trade pact after talks fell apart this year, and struck deals to promote clean energy and make it easier to do business.
Although Chancellor Angela Merkel and Prime Minister Narendra Modi made no mention in conversations with journalists of resuming talks on a free trade agreement between India and the European Union, it was perhaps the most significant “deliverable” of her trip to New Delhi.
Read: Angela Merkel on German business mission to India
The leaders “committed themselves to bringing about the earliest possible resumption of talks”, said a joint statement issued after their three-hour talks.
Asia’s third-largest economy has been relatively insulated from a slump in global trade, but Modi still needs to boost exports for his pitch to investors to “Make in India” to create skilled jobs for millions of young Indians.
Germany, Europe’s largest economy, is looking to expand its presence in India to compensate for a slowdown in China. Merkel’s delegation was joined by bosses from household names like Siemens, Airbus, E.ON and Thyssenkrupp.
The trade talks have been on ice since earlier this year when India walked out in a row over exports of generic drugs to the European Union.
Germany, a world leader in renewable energy, will also provide more than 2 billion euros ($2.25 billion) in aid for solar projects and green energy corridors – or high-efficiency power grids – as part of a broader push for sustainable development.
The assistance, part of a raft of agreements signed in New Delhi, dovetails with efforts to bind India into a global debate that will culminate in the COP21 climate change summit in December.
Read: India agrees to fast-track German business deals
“We look forward to a concrete outcome at COP21 in Paris that strengthens the commitment and the ability of the world, especially of poor and vulnerable countries, to transition to a more sustainable growth path,” Modi told reporters.
India, the world’s third-largest emitter of greenhouse gases, was the last major country to submit its energy strategy ahead of the UN climate conference.
India’s energy plan seeks to boost energy efficiency but makes no commitment to reduce emissions of greenhouse gases – reflecting its view that richer nations bear most responsibility for global warming.
Responding, Merkel said: “We have understood, Prime Minister, that climate protection needs to be embraced by the people – who also have to reap a benefit.”
India and Germany also signed an agreement to fast-track business approvals, providing German firms with a single point of contact to help them navigate a web of red tape that often thwarts initiative.