India–European Union relations

European Union–India relations

European Union

India
Diplomatic Mission
Delegation of the European Union to India, New Delhi Indian Mission to the European Union, Brussels
Envoy
Ambassador Tomasz Kozlowsk Ambassador Manjeev Singh Puri
Indian PM Narendra Modi with the President of European Council Donald Tusk, and the President of European Commission Jean-Claude Juncker, at the EU-India Summit, Brussels, 2016

The Republic of India maintains an ongoing dialogue with the supranational Institutions of the European Union which is separate from the bilateral relations with sovereign member States of the European Union.

In Asia the positive public perception of Europe is highest in India.[1]

India, the world's most populous democracy, has strategic partnerships with France, the United Kingdom and Germany.[2]

The foremost areas of programmed India-EU-28 cooperation are in the domains of education, cultural exchanges, joint-research in science & technologies, and law enforcement.

EU-India cooperation

Achievements

Administrative map of the Eurozone and European Union

India and the European Commission's Humanitarian Aid and Civil Protection department (ECHO) maintain an ongoing dialogue for the delivery of humanitarian relief supplies and assistance during natural disasters (floods, cyclones and earthquakes) and man-made crisis. ECHO has a long history of assistance as a donor of relief supplies & financing, project planning & coordination, and the in-field deployment of speciality skill-sets in South Asia.

Erasmus Mundus Action 2 project of the European Commission has organized a partnership between prominent universities in Europe and India.[3]

Jean Monnet Chair at Jawaharlal Nehru University in New Delhi was created to help increase the visibility of the European Union in India.

The inaugural EURAXESS Science slam in India was organized in partnership with the Indian Institute of Science Education and Research (IISER), Pune on 29 September 2013. The second edition was in partnership with Tata Institute of Fundamental Research (TIFR), Mumbai on 1 November 2014. The third edition was held on 30 October 2015 at the Alliance française in Bangalore. The 2016 edition will take place on 18 November 2016 in Hyderabad.[4]

The Asia Urbs programme, an initiative of the European Commission, has actively assisted INTACH in heritage conservation activities all over India including at Gingee Fort and Pondicherry.[5]

Ecole française d'Extrême-Orient in Pondicherry, which specializes in Indology research, has documented the archaeological heritage of South India with co-financing from the European Union.

Computer-aided taxonomic identification system of mangrove species of South-East India and Sri Lanka at French Institute of Pondicherry received assistance from the ASI@IT&C programme of the European Commission.

Indian Space Research Organisation (ISRO) is contributing towards augmenting ESA Galileo satellite navigation system and GPS service in northern Europe by sharing data from the Indian Regional Navigation Satellite System (IRNSS). ISRO Polar Satellite Launch Vehicle has launched Miniaturized satellites of several European universities and opened payload capacity on Indian CubeSats to European scientific experiments. India relies on Arianespace[6] for the launch of I-3K-class satellites to geosynchronous transfer orbits.

Statue of Nataraja at CERN near building A40. Gifted by Department of Atomic Energy (DAE), India

Physicists from Tata Institute of Fundamental Research (TIFR) have participated in experiments at CERN since the 1970s. Bhabha Atomic Research Center (BARC) provided superconducting dipole and quadrupole magnets for the Large Hadron Collider (LHC) at CERN Meyrin site. The world's largest magnet, weighing about 50,000 tons, is being designed at BARC and will be part of the CERN Iron Calorimetric (ICAL) detector for trapping atmospheric neutrinos produced by cosmic rays in Earth's atmosphere.[7]

India is participating in the International Thermonuclear Experimental Reactor (ITER) project by providing one-tenth of the components for gigantesque nuclear facility at Cadarache in France.[8] ITER-India, a specially empowered group within the Institute for Plasma Research is overseeing the in-kind commitments from India to ITER.[9]

Opportunities

The demographics and urban modernisation programmes of several Indian metropolitan areas has led to services and infrastructure requirements comparable to mid-sized European countries :

Metropolitan area Population (Mn) Comparable demographics
Delhi 42.0  Spain or  Poland
Mumbai 20.7 Scandinavian countries ( Denmark +  Sweden +  Norway)
Kolkata 14.6  Netherlands
Chennai 8.9  Sweden
Bengaluru 8.7  Austria
Hyderabad 7.7   Switzerland
Pune 7.5  Bulgaria
Ahmedabad 7.2 Baltic states ( Estonia +  Latvia +  Lithuania)
Projected economies of India and China compared to US between 2009-2050.

European multinational companies are global technology leaders in several niche high-value-creation domains within industry verticals like aviation & aerospace, civil nuclear power, rail transportation, waste management, military hardware, life-sciences & medicare, leisure & tourism, textiles & apparels, etc.

Several European universities have vibrant student-exchange and research partnerships with Indian educational institutions. European Commission support for joint research and heritage conservation projects have enjoyed widespread acclaim in India.

India ranks amongst the fastest growing healthcare, education, insurance, ICT, logistics, hospitality, transport and public infrastructure markets in the world.

India in Europe

Europe is an important destination for Indian students seeking to pursue under-graduate and post-graduate education overseas. United Kingdom is the prime destination for Indian students within the European Union.[10]

Ayurvedic traditional medicine and Yoga have been popular in Europe since its introduction into Europe in the mid-19th century.

Indian fine arts and culture is well received in Europe. India has regularly held cultural events in Europe : L'Année de l'Inde (France 1985), Bombaysers de Lille (France 2006), Europalia India (Belgium 2014), Namasté France (France 2016).[11][12][13][14]

Europe is popular with Indian tourists. Indian movies filmed in outdoor locations have popularized European [15] destinations : the Alps, French Riviera and cities like Paris, London, Lyon, Prague, Budapest, Dublin, Rome and Venice. Indian movies are regular entrants in film festivals in Europe. Bollywood is increasingly represented at the annual Cannes Film Festival. Picturesque European locations have hosted lavish weddings for Indian billionaires.[16][17][18]

Efforts by Indian multinational companies, operating in industrial engineering and ICT domains, to cover European markets via quality-price competition and by providing innovative goods & services substitutes has seen mixed results due to structural shortcomings and regulatory difficulties.[19][20][21][22]

Europe in India

Iconic brands from companies headquartered in the European Union and which enjoy universal recognition in India include Airbus, Alstom, Axa, BNP Paribas, Dassault, Bic, Michelin, Saint-Gobain, Sodexo, Hermès, Cartier, Louis Vuitton, L'Oréal, Chanel, Dior, Decathlon, Lacoste, Montblanc, Renault, Volvo, Philips, Mercedes-Benz, BMW, Bosch, Marks & Spencer, HSBC, Standard Chartered, Nokia, Capgemini, Piaggio, Ferrari, Fiat and Gucci.[23]

Bangalore, Hyderabad, Chennai and Pune host a steadily growing base of European economic migrants who have created niche high-value-addition Small and medium-sized enterprises in engineering, biotechnology and ICT sectors as joint ventures with Indian partners. European start-up ventures in ICT technology increasingly use Indian back-offices and development centres during their kick-off phase to maximize seed money. Some European actors have focused their acting careers on Bollywood movies and by modelling in advertisements for the Indian market.[24] Examples of the more prominent European actress-models in Bollywood are Elli Avram, Suzanne Bernert, Claudia Ciesla, Hazel Crowney, Amy Jackson, Kalki Koechlin, Alice Patten.

Trade and investment

Airbus A320 passenger jet aircraft of flag carrier airline Air India

In 2015, the Indian economy grew at 7.5%. The performance of the Indian economy made it the fastest growing large economy on the planet (China registered 6.9% growth).[25]

IMF economic forecasts for India predict 7.3% GDP growth for India in 2015-16 and 7.5%in 2016-17.[26]

The European Union (EU28) is India's second largest trading bloc, accounting for around 20% of Indian trade (Gulf Cooperation Council is the largest trading bloc with almost $160 billion in total trade[27]).

India was the European Unions' 9th largest trading partner in fiscal year 2014-2015.[28][29]

Whilst EU-India trade has continued to progress in absolute terms for the past several decades (aided in part through the inclusion of trade data of new member States in successive waves of Enlargement of the European Union), the past couple of years have shown a decrease in trade: bilateral trade declined to €76 billion in 2012 and further still to around €73 billion in 2013.

EU-India trade in goods grew from €28.6 billion in 2003 (EU15 with 15 member States) to €77.6 billion in 2015 (EU28).[30]

2014-15 EU28-India trade data for goods demonstrate that about 16.9% of all Indian exports went into the EU and about 11% of all Indian imports were from the EU.[30]

Annual EU-India trade in commercial services tripled from €5.2 billion in 2002 (EU15) to €17.9 billion in 2010 (EU27)[31] before dipping to 14.0 billion in 2015 (EU28).[32]

The European Union's commercial presence in India has been dropping at an alarming rate: market-share in India for goods and services from the European Union has fallen by more than 50% over the past decade. EU-India trade in goods as a percentage of India's total trade has continuously declined going from 26.5% in 1996-97 (EU15) to 13.9% in 2011-12, 13.2% in 2013-14 (EU27) before a slight upturn to 13.3% in 2014-15 (EU28).[33]

France, Germany and UK collectively represent the major part of EU-India trade.[28] Denmark, Sweden, Finland, Spain and Poland are the other more prominent European Union countries who trade with India.[34]

Fiscal incentives in offshore financial centres and low-tax jurisdictions favour the British Crown dependencies, Belgium, Netherlands, Luxembourg and Ireland as tax-optimizing routes for channelling equity and capital investments into India. Widespread use of favourable double-taxation bilateral treaties and Special purpose entity structures (Structured investment vehicle held Off-balance-sheet) substantially distorts statistical data on business relations between India and individual member States of the EU28.

EuroStat data shows that European FDI to India grew from €1.56 billion in 2004 to a peak of €13.83 billion in 2011 before dropping sharply to €5.48 billion in 2012 [35] and €4.3 billion in 2013.[36] (Note: As a measure of comparison, Remittances to India by the Indian diaspora worldwide was US$72bn for the 2014-2015 fiscal period and US$71bn for 2013-14).[37][38][39]

Indian investments into the EU28 were €1.1 billion in 2014-15 and EU28 investments into India was €5.3billion in 2014-15.[40]

Corus integrated steel mill at Velsen-IJmuiden, Netherlands. Acquired in 2007 by Tata Steel

Jaguar Land Rover, the iconic British multinational car manufacturer was purchased in 2008 by the Indian conglomerate Tata Group[41][42][43] who is the largest private-sector industrial employer in the United Kingdom.[44] Several Indian-owned companies have value-creating operations and manufacturing facilities within the European Union : BeNeLux (Crompton Greaves, Binani Industries, Tata Consultancy Services, Jet Airways, Dishman Pharmaceuticals and Chemicals), Poland (Videocon & Zensar Technologies), France (Bharat Forge), Czech Republic (Infosys), United Kingdom (Dr. Reddy's Laboratories, Tata Motors), Sweden (Tech Mahindra), Germany (Biocon), Italy (Mahindra & Mahindra), Romania (Wipro).[45]

Paradigm of emerging markets and global geopolitical reconfiguration

The importance of Millennium Development Goals (MDGs) in redefining what are the poverty drivers for India. A. K. Shiva Kumar development economist.

India views the ongoing global power shift [46] from the Atlantic to the Indian Ocean as an opportunity to lift millions of persons out of extreme poverty and a March to Modernity.[47] Indians, observing the Chinese geopolitical ascension,[48] have concluded their country can only be taken seriously in 21st.century world affairs if it can speak from a position of economic strength. Investors and companies have been encouraged to tap the aspirations of the 1.2 billion strong[49] Indian market for goods & services and profit from Indian Ocean trade through the Make in India initiative launched by the Government of India.[50][51] The challenge facing India is to successfully leverage the country's youth dividend[49][52][53][54][55][56] towards achieving the Indian Century [57][58][59] and to avoid hubris that India's economic growth is inevitable.[60][61][62][63]

The global contribution to world's GDP by major economies.[64] Before the 18th century, China and India were the two largest economies by GDP output.
Gross Domestic Produce (GDP) based on Purchasing Power Parity (PPP) valuation of top 10 countries and trade blocks (Source: IMF 2016)

India, just as other Indo-Pacific regional powers (Japan, Vietnam & Indonesia), are no longer content with peripheral influence in global discussions.[65][66] Several countries in the Indo-Pacific region seek a radical reordering of the post-WWII global hierarchy of power.[67][68] Minor powers have grown enough in self-confidence to form new partnerships in order to further national interests and political goals.[69] The consensual view in Asia is that America will continue to remain relevant in world affairs for the foreseeable future, but already no longer enjoys uncontested supremacy.[70][71][72][73][74][75] Reflecting upon the extent to which the stakes have risen in the power politics at the global high table, US President Barack Obama implored Americans to "win the future by out-innovating, out-educating and out-building the rest of the world".[76] Relentless efforts by American think-tanks and government officials to reassure alliance partners about American primacy in global affairs flies in the face of a steady stream of setbacks and challenges from Central Europe right through to the Indo-Pacific region (EU nations joining the AIIB, Russian annexation of Crimea, dismemberment of Ukraine, redrawing of colonial borders by loosely affiliated non-State entities,[77] clandestine WMD (nuclear weapons & ballistic missiles) developed by Israel & North Korea, stalled Israeli–Palestinian peace process, forceful assertion on maritime claims by China).[78][79][80]

The rising political significance of Latino-Hispanic American, African American and Asian American electorates[81][82] has changed the traditional dynamics of electoral politics in the USA. The US political spectrum has mutated out of its Eurocentric mould and become truly global: influential Asian, African and Hispanic voices have been nominated to senior government and corporate offices; resulting in a reordering of ideas, priorities and strategies.[83][84][85][86][87][88][89][90]

The European Union - still reeling from the combined effects of the global economic slowdown, European sovereign debt crisis, a re-assertive Russia,[91] European migration crisis and several high-profile corporate scandals - appears rudderless in trying to find solutions to reverse the surge of Euroscepticism, anti-establishment and anti-globalization movements.[92][93][94][95][96] Uncertainties in Brussels over the future state of the European Union are directly reflected in EU-India relations. India's publicly stated positions on security cooperation with the USA, Russia, Vietnam & Japan, and trade prioritization efforts aimed at ASEAN, Japan and the USA have clearly been at the expense of the European Union. In October 2015, Hans Kundnani a senior fellow of the German Marshall Fund (GMF) observed that Europeans were increasingly "out of sync" with India.[97] Washington's pivot to Asia has exposed intrinsic weaknesses in the Europe Union's foreign (CFSP) and defence (CDSP) policies. US-India strategic entente has moved India closer to the transatlantic perspective of the European Union coming out of Washington.[98][99] The European Union leadership at Brussels, far from fostering an atmosphere of trust and cooperation, has succumbed to political interference from bilateral relations and allowed lobbyists to drive the EU-India dialogue into irrelevance.[100] In Asia, the effectiveness of Europe's discourse and self-portrayal as a global political norm-setter in doubtful.[101][102][103][104][105] Acceptance of the European Union as a normative power in a multi-polar world is challenged by emerging powers.[106][107][108][109][110][111][112][113][114][115][116] Apart from trade, developmental aid, maritime escort duties against pirates and symbolic military exercises; European countries have little else to show in the Indo-Pacific region due to budgetary and geopolitical constraints. Niche high quality-price exports from Europe are steadily being squeezed out of traditional market segments. In India, product substitution of manufactured goods from domestic and regional suppliers, has seen the European Union's market-share drop by more than 50% over the past decade.[117]

For the 2012-2013 (April–July) period, India's top 10 trading partners according to data published by the Indian Ministry of Commerce:[118][119]

Rank Country Total Trade bn US$ Trade Share %
1  China 49.5 8.7
2  United States 46.0 8.1
3  United Arab Emirates (UAE) 45.4 8.0
4  Saudi Arabia 36.3 6.4
5   Switzerland 16.7 2.9
6  Iraq 15.5 2.7
7  Singapore 15.4 2.7
8  Indonesia 14.8 2.6
9  Germany 14.7 2.6
10  Hong Kong 14.6 2.6

On 7 October 2015, German Chancellor Angela Merkel and French President François Hollande made a rare joint address at the European Parliament to recognise the seriousness of the ongoing socio-political turmoil within Europe and warned that the European Union was on the verge of breakdown. Francois Hollande cautioned European member-states to show solidarity in jointly solving common problems both within Europe and in its immediate neighbourhood, failing which "end of Europe" and "total war" could become inevitable.[120][121][122][123] It had been 26 years since the leaders of France and Germany jointly addressed the European Parliament: Francois Mitterrand and Helmut Kohl made a joint appeal for solidarity towards East Germans just weeks after the fall of the Berlin Wall.[124][125]

Controversial actions on migrants, sovereign debt and diesel engine exhaust gas control [126] by German Chancellor Angela Merkel, Finance Minister Wolfgang Schäuble and Volkswagen respectively have boomeranged out of control and severely compromised Germany's arduous 70-year long image makeover.[127][128][129][130][131][132][133][134][135][136] Europe-wide acceptance of Germany's leadership role of the European Union hangs in the balance after widespread dismay at the rigid political stance adopted by the German government and perceptions that the harsh conditions which Germany sought to impose upon Greece during the Greek sovereign debt crisis were overbearingly punitive.[137][138][139][140][141] Portrayal of Germany as a normative model of honesty, efficiency and ethics (incessantly repeated by German officials, mass media and private citizens during the Greek sovereign debt crisis)[142] came undone following revelations of fraud at a global level on an industrial scale by Volkswagen.[143][144][145][146][147][148][149][150] Time Magazine termed the actions of Volkswagen as "superbly engineered deception, with 11 million VW diesel cars fitted with special software that enabled them to cheat on emissions tests.(...) German industry was supposed to be above this sort of thing–or at least too smart to get caught."[151] A reality-check of the geopolitical power of individual members of the G4 nations at the 2015 UN General Assembly and practical aspects of Asian geopolitical compulsions have influenced India's choice to refocus on strategic bilateral engagements with France and UK who are UNSC P5 member States. The inevitability of a security reordering in Eurasia, impending transformation of the political landscape within the European Union due to the unchecked rise of Euroscepticism, fast deteriorating security situation on the Eastern and Southern periphery of the European Union, assertive manoeuvring by Russia & China in their traditional areas of influence, eventuality of alliances to counterbalance and prevent German dominance of Western Europe, and the improbability of Germany acceding to the UNSC have already been factored in by Indian strategic planners.[152][153][154][155][156]

Map of overland route from India to Britain. (Source: "A journey from Merut in India, to London, through Arabia, Persia, Armenia, Georgia, Russia, Austria, Switzerland, and France, during the years 1819 and 1820", Thomas Lumsden 1822.)
Geopolitical map of the Eurasian region

Perpetuation of State borders in the Eurasian continent - which contain several hotly contested demarcation lines which date back from the European Colonial period in Asia: (Nine-dotted line, Sykes–Picot Agreement,[157][158] Durand Line, McMahon Line, Radcliffe Line); appear increasingly elastic [159][160][161] in the face of geopolitical, socio-economic and technological transformations.[158][162][163][164][165][166][167] Colour revolutions and the Arab Spring have destabilized the Caucasus and Western Asia respectively setting-off unintended repercussions right across the Eurasian continent: revival of historic rivalries between Turkey (Ottoman Empire) & Iran (Persia),[168][169][170] emergence of the Daesh[171] and a proxy war involving regional and global powers.[172][173][174][175][176][177][178][178] India has been reluctant to get involved in the Middle-Eastern turmoil due to ethnic Persianate roots and historic cultural influence of India's 172 million Muslim population (14.2% of the country's population according to the 2011 census).[179][180][181] The Government of India has prohibited Indian nationals from traveling to Syria & Iraq and issued directives allowing police to detain persons suspected of having served as mercenaries.[182][183]

Dr.Manmohan Singh, India's former Prime Minister, observed that the concurrent geopolitical re-emergence of China and India has initiated a period of "cooperation and competition" in the Indo-Pacific region: "it is an era of transition and consolidation. Inclusive economic growth remains the bedrock of our country's future. Infrastructure, education, development of skills, universal access to healthcare must be at the core of our national policies. Being a strong and diversified economy will provide the basis for India playing a more important global role. Hence the primary focus of India's foreign policy has to remain in the realm of economic diplomacy,". Commenting on the ongoing turmoils in Ukraine, West Asia and North Africa, Dr. Singh observed: "Competing and conflicting interests among Western and regional powers have led these countries to support rebel groups in countries like Iraq and Syria. These rebel groups have joined hands with extremist Jihadist groups to create the Islamic State in Iraq and Syria. Chaos and civil war have been the bitter harvest of the flawed policies of regime change in Arab countries, leading to unprecedented violence and human suffering, forcing Arab and Afghan refugees to flee in hundreds of thousands to Europe. The impact of these developments on a weak European economy will only add to the doubts about sustained economic recovery in the EU,".[184]

The primacy of Western-led post-World War II supranational institutions and Bretton Woods system in shaping the outcomes of Asian affairs is no longer a given.[185] Asian countries having not forgotten their colonial past and bitter lessons learnt from the 1997 Asian financial crisis, are unwilling to negotiate with external powers on matters affecting state sovereignty. The BRICS are committed to building a multipolar world order and have agreed to coordination on core interests of individual members.[186][187][188][189][190][191] Western sanctions against Russia prompted China to conclude a $400 billion energy accord,[192] effectively neutralizing efforts to drain Russian finances.[193][194][195][196] BRICS are wooing investors with the allure of best potential for economic growth.[197] Asian Infrastructure Investment Bank (AIIB), North–South Transport Corridor, Asian Highway Network, New Eurasian Land Bridge and Eurasian Economic Union (EEU) has received increased attention at Track-2 initiatives of the RIC (Russia, India & China) countries.[198][199]

Muscle flexing by China on the Sino-Indian Line of Actual Control (LAC)[200] against the backdrop of prominent displays of military might (live test of an ASAT weapon in 2007 by China in response to a 1985 satellite-kill by the USA) and challenges (the Hainan Island incident where the President of the USA was forced to apologise to China to ensure the safe return of the crew of a US Navy intelligence gathering aircraft which was intercepted by PLAN fighter planes) has rekindled an arms race across the Indo-Pacific region.[201]

India has staked a claim to playing a central role in the Asian Century [202][203][204][205] by embarking upon a programme to modernise and diversify assets of the Strategic Forces Command, raise the profile of the Andamans and Nicobar Command (ANC), build strategic petroleum reserves, and renew civilizational ties with regional countries. India has prioritized the strengthening of strategic partnerships - with Russia, Vietnam, Japan, Singapore, Oman & Iran - in order to offset and forestall an irrecoverable shift in strategic balance of power in Asia emanating from a resurgent China seeking to advance its One Belt, One Road initiative.[206][207][208] Agreements to install ocean surveillance capabilities in Madagascar, Fiji, Seychelles (Assumption Island),[209] Mauritius (Agaléga) & Maldives seeks to shelter India's strategic interests and diaspora.[210][211][212][213][214] India's national security planners have sought to consolidate India's presence and extend influence in countries which are key to China's One Road, One Belt with special focus on Oman, Iran, Afghanistan, Tajikistan, Turkmenistan, Kazakhstan, Uzbekistan, Sri Lanka, Nepal, Bangladesh, Myanmar and Vietnam. India has increased security dialogues and military exercises with Vietnam, Japan, Australia and USA while concurrently undertaking confidence building measures with China with the aim of maintaining peace and stability in the Indo-Pacific region.[215][216][217][218][219][220][221][222]

The tendency of Indians to get either enraged or swooned by lofty rhetoric when it comes to China prompted Kishore Mahbubani, dean of the Lee Kuan Yew School of Public Policy at the National University of Singapore, to advise unwavering attention to the improvement of societal aspirations and caution against over-reach : "it is in India's interest to bide its time, remain calm, not get distracted by geopolitics and instead focus on core strengths. India has the advantage, even on China, because of a young population. Put aside the border for now, engage China, take advantage of their competencies".[223] Speaking out against a distorted portrayal of China in the Western media, Chandran Nair of South China Morning Post deplored journalism which betrayed deep-rooted ideological biases.[224] His view are echoed by Singapore's Foreign Minister K. Shanmugam, who during the 2014 Hong Kong protests said: "There has been much anti-China bias in Western media's reporting".[225]

Jaguar Cars on display at 2012 Delhi Auto Expo. Jaguar Cars was acquired by Indian conglomerate Tata Motors to rapidly enter the global mid-size luxury/executive car market.

The scale and speed of economic development in the Indo-Pacific region,[226][227] in both absolute and relative terms,[228] has profoundly shaken public self-confidence in Western countries[229][230][231] and stunned observers.[232][233] In 2014, Asia-Pacific (+29%) accumulated wealth faster than Europe (+6.6%) and North America (+5.6%). However, America leads in absolute numbers with $370,000 (including life and pension assets) per household and Europe follows with $220,000.[234] US sub-prime credit default related to student debt and auto loans stands unresolved and has been flagged as a significant bubble risk.[235][236]

The merging of an "economic Asia" - wherein corporations are easily wooed with the pan-Asian win-win logic of cooperation and integration - and a "security Asia" structured upon delicately balanced zero-sum reasoning of competition and disintegration; has presented unique scenario for the future according to Evan Feigenbaum and Robert Manningan: "economic Asia" could become "an engine of global growth", while "security Asia" could, in the worst-case scenario, lead to great power war.[237] Recent developments indicate that while India and China are increasingly competing on geopolitical matters, the two countries are simultaneously willing to bridge differences and cooperate on trade.[238][239][240][241]

North–South Transport Corridor (NSTC) showing terrestrial and maritime trade routes
Historic terrestrial and maritime trade routes of Asia

China-India driven economic growth, fresh opportunities to develop new geographical zones due to improved Sino-Indian relations,[242] observed collateral consequences on local populations & economies caused by recent US-led military interventions in Iraq & Afghanistan, conspicuous absence of the US President at the APEC Indonesia 2013 summit due to the United States federal government shutdown of 2013,[243][244][245] budgetary constraints of the US military,[246] improvements in anti-access area denial (A2/AD) capabilities by littoral States to counter maritime power projection assets,[247] limitations in the US air-sea battle doctrine,[248] risks of conflict escalation,[249] historic intra-regional rivalries,[250][251][252][253][254] the fact that post-WWII American interventions in major conflicts in Asia have not been victorious (stalemate in the Korean peninsula, Vietnam debacle, ineffectual US-led COIN operations in Afghanistan) and the unconvincing US pivot to Asia, dissolved the appetite amongst Asian countries to support a US-led China containment policy.[255][256][257][258][259][260][261][262] US economic, political and military dominance is in relative decline compared to emerging powers.[263][264][265] Asian countries increasingly view the US primarily as a market for manufactured goods and as a highly capable provider of security infrastructure.[266][267][268]

Geopolitical map of the Heartland theory from Halford Mackinder's 1904 The Geographical Pivot of History

Geopolitical re-balancing by regional powers has allowed several Asian microstates and LDCs to extract significant economic advantages and concessions while staying on the sidelines of regional power-play.[269][270][271][272][273][274] Prime Minister of Singapore, Lee Hsien Loong, had a word of caution regarding strategic hedging in the regional power-play and pointed to Singapore's proximity to India and China: "Singapore knows it's place in the world".[275]

Asia's emerging economies have enthusiastically embraced clever, innovative, frugal and shrewd market-access strategies to face-up to global competition.[276] The 2015-2016 Indian budget foresees co-development of manufacturing hubs in Southeast Asian countries.[277] In March 2015, foreign minister Sushma Swaraj announced that India's 2015 target for trade with ASEAN is $100 billion and both sides are aiming to double it to $200 billion by 2022.[278] India has accelerated initiatives to resolve insurgency in Northeast India[279] to promote economic development within the Seven Sister States.[280][281]

The improvement and optimization of inter-Asian trade through future mega infrastructure projects, like the Bangladesh-China-India-Myanmar (BCIM) Economic Corridor and Thai Kra Isthmus Canal,[282] are increasing seen as viable and vital to the continuation of economic integration of regional markets.[283][284][285][286][287][288] In May 2014,[289] India announced prioritization of Asian Highway Network regional cross-border connectivity programmes like the Kaladan Multi-modal Transit Transport Project with Myanmar and the Trilateral India-Myanmar-Thailand Friendship Highway to Thailand.[290][291][292] Bangladesh and Myanmar, both fast emerging as nodal road and rail connectivity transit routes, have received special attention in India's foreign and trade development policies.[293]

Heads of State and Government from BRICS nations join hands to express cooperation and solidarity ahead of the 2016.

Inadequate representation in global security and governance architectures and the tendency of the G7 to pre-emptively set the agenda for the G20[294][295][296][297][298] has led India to complement traditional international forums such as the United Nations Security Council, World Bank, International Monetary Fund (IMF), World Trade Organization (WTO) and Asian Development Bank (ADB) with special interest groupings such as BRIC/BRICS, Shanghai Cooperation Organisation (SCO), East Asia Summit (EAS), Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC), Indian-Ocean Rim Association (IORA), Regional Comprehensive Economic Partnership (RCEP), Asia Cooperation Dialogue (ACD), Bangladesh–China–India–Myanmar Forum for Regional Cooperation (BCIM), Mekong–Ganga Cooperation (MGC) and South Asian Association for Regional Cooperation (SAARC).[299][300]

India aspires to an incontournable role in the Asian pivot to Asia.[301][302][303] Between 2004 and 2014 Western think-tanks, especially in the US and UK, failed to pick-up on tell-tale signs of impending transformations to the Indian political scene : swings in electoral voting patterns in rural areas (60% of India's 1.2billion population live outside urban population centres), large-scale nationwide citizen-led protests around specific societal agendas (anti-corruption, right to information), and rapid changes in priorities of the growing middle-class electorate. The association of improvements in basic education, vibrant & unrestricted mass media journalism, penchant for political debate in Indian society,[304] and the huge increase in Indians working and studying abroad has changed how Indians perceive themselves in the global arena in general and Asia in particular. Proximity to Dubai and Singapore - both immensely popular business and tourism destinations besides hosting huge Indian diaspora - has influenced the imagination of Indians in terms of possibilities for wealth creation through trade & infrastructure development.

Academics have raised concerns about the relaxed institutional attitude in the West to rapid metamorphosis in Asia.[305][306][307] In 2010, John Doggett of McCombs School of Business, University of Texas issued a wake-up call: "China and India are beating us at our own game".[308][309] Highlighting the "inability to keep pace with the transformations" in Asia by Western countries, Michael Kugelman - South and Southeast Asia expert at the Woodrow Wilson International Center - advocated a change in mind-set and the necessity for Western countries to make their presence felt in India.[310][311][312] Explaining the need for a review of available expertise on India centric matters, Jakob De Roover of University of Ghent in Belgium opined: "India and the West could together look for solutions to the problems that we share. Instead, Western commentators reproduce old colonial stories about India as an immoral culture. This gives them a twisted relationship to the Indian people. On the one hand, they keep turning towards the same class of Indian journalists, activists, and intellectuals for ‘local knowledge’. But these native informants merely talk the talk of the West to the West."[313] Western think-tanks have morphed into place-holders for politicians and bureaucrats employing armies of lobbyists instead of analysts who are researchers or academics.[314]

Asian regional powers are unwilling to forfeit any notion of an independent foreign policy and thereby become a tool in the global exercise of power.[315][316] Speaking at the 2015 Shangri-La Dialogue, the Indian Minister of State for Defence Rao Inderjit Singh postulated that Asian countries will increasingly attend to their national security and internal markets through structured dialogue within Asian multilateral structures like ASEAN and SCO rather than be over-reliant on formal alliances with external powers.[317]

American capacity to shape global outcomes (Iraq, Afghanistan, Libya, Syria, Ukraine) has been ineffectual. Recent US rebalancing and alliance-building activities in the Indo-Pacific region have demonstrated that Asian states are unwilling to settle for a Western-dominated global order and blindly acquiesce to an American-led construct of geopolitical frameworks, rules-based trade and mobility mechanisms which do not adequately address the interests of Asian countries.[318][319][320] Singapore's Minister for Defence, Dr Ng Eng Hen observed: "By virtue of its economic and military heft, China's leadership role in international affairs is a given. We cannot pretend that China is just like any other major economy. By its actions or lack thereof, China de facto sets norms and even rules for the global system."[321] Stressing the importance of encouraging the acceptance or continuation of universal principles Dr.Ng emphasised: "And it is in everyone's interest to maintain a balance of powers, so that dominant powers would take into account the interests of small and large states.[322]

The Millennium Development Goals (MDGs) are eight international development goals that were officially established following the Millennium Summit of the United Nations in 2000, following the adoption of the United Nations Millennium Declaration. All 193 United Nations member states and at least 23 international organizations have agreed to achieve these goals by the year 2015.

The rise of authoritarian capitalism has dealt a blow to assumptions that political systems, in the post-Cold War era, will converge as liberal democracies and be shaped along Western values.[323][324][325][326][327] The majority of Asian states have had autocratic leaders who curtailed civil liberties and imposed restrictions on democratic institutions within their countries. Asian populations have accommodated authoritarian leaders (Examples: Mahathir Mohamad of Malaysia & Lee Kuan Yew of Singapore),[328] showing preference for stable socio-economic development, progressive reduction of wealth-gap and continuation of nuclear family structures over principled stands on human-rights and democracy promotion.[329][330][331][332][333][334][335] Philosophical and religious beliefs play an important role in the acceptance by Asian populations of slow-paced economic growth spanning over several generations at a time when the lives of their Western contemporaries are driven by quarterly financial results and speculative financial markets.[336][337][338][339][340][341][342][343][344][345][346][347][348][349][350][351]

Social engineering of Asian societies along western values of liberalism and individualism has seen mixed results across Asia.[352][353][354][355][356] In Asia, many aspects of the 'American way of life' and the 'European social model' have been adopted as economic benchmarks concurrent to demands for stricter statutory controls on indecent exposure, public nudity, pornography, etc.[357][358][359][360][361] "A permanent feature of American opinion and action in foreign policy is the wish, the hope, that other nations might turn from the 'error of their ways' and become democracies," says historian Jacques Barzun and spelt out limitations to democracy promotion: "it cannot be fashioned out of whatever people happen to be around in a given region; it cannot be promoted from outside by strangers; and it may still be impossible when attempted from inside by determined natives." Former US deputy Secretary of State William J. Burns, who heads the Carnegie Endowment for International Peace opined: "Our own preachiness and lecturing tendencies sometimes get in the way, but there is a core to more open democratic systems that has an enduring appeal," (...) "respect for law and pluralism creates more flexible societies, because otherwise it's hard to hold together multi-ethnic, multi-religious societies."[362] India's former finance minister Palaniappan Chidambaram identified the fundamental error in US foreign policy: "Believing that there is a U.S.-imposed solution to every problem."[363]

The non-Western rational of Asian diplomacy in the post-Colonial era appears to balance nationalist aspirations, developmental opportunities, shared cultural roots and historical legacies.[364][365] Asia's future is powerfully shaped by "History and nationalism, not ideology," according to Nayan Chanda.[366][367][368]

Paucity of senior-most bureaucrats from India, China and Russia within Western think-tanks has left Western nations struggling to identify the ever-evolving dynamics of decision-making and fully comprehend Asian perspectives on geopolitical issues; determinants which are fundamental to assessing key trends and anticipating policy shifts. The Government of India through its Official Secrets Act places strict constrains on practitioners of foreign policy and proscribes unauthorised biographies and unvetted publications by serving and retired senior civil servants and defence personnel. The United States diplomatic cables leak damaged careers and reputations and has instilled a sense of reticence within the political and diplomatic establishment to express divergent ideas and opinions or share privileged information.

The appointment in January 2015 of former Indian Ambassador to the US, Subrahmanyam Jaishankar, as Foreign Secretary [369][370][371] seeks to reassure Western countries about Indian strategic intentions in Asia.[372][373][374] Subrahmanyam Jaishankar is the father of Dhruva Jaishankar - a German Marshall Fund (GMF) Transtlantic Fellow in Washington.[375]

Bilateral ties with European sovereign nation-states

Policy determinants and comparative assessment criteria

Two World Wars (WW1 & WW2) followed by the United Nations-mandated decolonization process dramatically reduced the sphere of influence of European colonial powers in the Asia-Pacific region. The Cold War fixated the attention of Europeans to the North Atlantic region, with occasional forays into sub-Saharan Africa undertaken essentially to maintain control over former colonies and protect commercial rights over raw-materials.

The turn of the century stock-market collapse (2000 Dot-com bubble) and military engagements (2001 Afghan expedition & 2003 Iraq invasion)[376][377] initiated a downward trend for the European Union's socio-political project. The 2008 Russo-Georgian War and the 2009 European sovereign debt crisis, following the 2007 US sub-prime mortgage market meltdown, derailed the academically theorized narrative about European identity, regional stability, political unity, inclusive growth and shared development.[378][379][380]

A succession of controversial political appointments to the highest offices of the Institutions of the European Union - who have failed to garner favourable public opinion for their vision of the European project and demonstrate leadership required to steer the European project - has resulted in successful electoral challenges to prevent any further devolution of sovereignty from the national parliaments to the Institutions of the European Union in Brussels. European electorates have become deeply suspicious of the democratic deficit, corporate lobbying activities and opacity of political arrangements brokered in Brussels.[381][382][383][384][385][386][387][388][389][390][391][392][393][394][395] The transition from authoritarian rule to libertarian democracy has not been fully completed by Eastern European countries and is affecting the elimination of corruption & nepotism, religious & ethnic tolerance, humanitarian solidarity, respect of human rights, etc.[396][397][398][399][400][401][402][403][404][405][406][407][408][409][410][411][412][413]

The 2013 Ukrainian crisis and the 2014 Annexation of Crimea by the Russian Federation unsettled the Baltic states and revived Cold War-era fears in former Warsaw Pact countries. Any political solution to the European refugee crisis needs accommodation by Russia and the normalisation of relations between Brussels and Moscow.[414] European public-opinion is against the engagement of armed-forces in combat operations in external conflict zones [415] and against military involvement to aid any other NATO member state who is under attack.[416][417]

A disorderly Brexit by the UK from the European Union could have consequences far beyond the European Union.[418]

Referring to ongoing global geopolitical rebalancing and how China and India perceive the European Union, André Sapir opined that the European Union leadership needed to understand its place in the world: "Brussels is not Washington".[419]

"The EU is not and never will be a superpower" because the EU lacks "the substance of superpowers" due to shortcomings in the EU foreign & military policy according to David Miliband, the former UK Secretary of State for Foreign and Commonwealth Affairs, who explained the requirements: "reach [and] possess the capacity to arrive quickly anywhere with troops that can impose their government's will".[420] Former Australian Prime Minister Kevin Rudd opined: "In geopolitical terms Europe is now irrelevant".[421][422][423][424]

With less than a 1000 career diplomats, staffing is the weak spot of Indian diplomacy. In a fast-changing geopolitical context, India's bilateral relations with influential EU countries (where clear and fast political leadership can be expected) are prioritized over multilateral EU-28 discussions (which besides being lengthy, quite often end in unsatisfying compromises).

Estimated and projected populations of the world and its continents (except Antarctica) from 1950 to 2100. The lower and upper boundaries of the shaded regions correspond to low and high variants (lower and upper bounds) of the projections by the United Nations Department of Economic and Social Affairs.

The future demographics of Europe is most favourable to France where the fertility rate is closest to the replacement level.[425] The econometrics of an aging Europe point to serious socio-economic issues for Germany,[426][427] Italy, Spain and Poland in the years ahead.[428] Initiatives to offset population shrinkage through selective immigration schemes has faced hostile public and political sentiment.[429] Northern and Eastern European countries resist immigration and have adopted onerous residency permit requirements to dissuade migrants.[430][431][432][433][434][435][436] Protection of ethnic composition of communities and cultural identity have entered the political discourse.[437][438][439][440][441]

India is faced with huge challenges to manage its vast population reserve and correctly transition from the burden of overpopulation to empowering Indians to drive domestic growth.[442] [443][444][445] The process of technology transition & human capital capacity-building initiated in India during the 1960s started bearing its fruits in the mid-1990 and dove-tailed neatly with the adoption of economic reforms rendered inevitable after the end of the Cold War. Reduced venture capital facilities forced educated entrepreneurs to leverage intra-familial/neighbourhood angel investors to create technology start-ups right from the beginning of the digital Revolution, many of which have matured into niche/sectoral leaders (Biocon, Reddy Labs, Sun-Ranbaxy, Dishman, Wipro, Infosys, Larsen & Toubro, Welspun, Suzlon, Vedanta, Reliance). Prudent opening-up of the Indian economy has allowed long established domestic business conglomerates (Tata, Mahindra, Birla, Bajaj, Kirloskar, Godrej, TVS, Essar) to select optimums in production–possibilities in preparation for competition in the domestic markets from global heavy-weights. Corporate India is increasingly using the public-private partnership model to cater to India's vast public infrastructure requirements.

Cultural affinity for education - with emphasis on sciences & the arts - within the increasingly affluent Indian middle-class and the vibrant entrepreneurial ecosystem have enabled sustainable improvements on socioeconomic indicators. Local companies continually leverage India's vast demographic reserve through apprenticeship-based employment and thereby contribute to the expansion of the skilled workforce.

Trend analysis of key economic indices and benchmarks (Purchasing power parity, Gross national income, Gross domestic product, Debt-to-GDP ratio, Foreign-exchange reserves, Balance of payments, Balance of trade, Inflation, Knowledge Economic Index, International Innovation Index) correlates to the shrinking knowledge, technology and digital divide which separates heavily populated emerging countries from advanced economies. Globalisation has demonstrated the dangers of Chinese-style copycatting, exposed the limits of quick-fix jugaad and highlighted the need for indigenous path-breaking innovations.[446] Emerging economies are multiplying innovation launch-pads through the development of specialized centres of excellence for knowledge addition.[447][448]

India has already bridged critical technologies, made advances in frontier technologies, built-up strategic assets and achieved the critical mass of skilled human capital necessary for its knowledge economy and information society drive domestic growth.

EU Group of Six

France and Germany, colloquially referred to as the 'Franco-German couple', are the principal driving force behind the European project.[449] France, Germany, UK & Italy form the EU-4 with each controlling a 8.4% share of votes within the Council of the European Union. The EU-4 with the addition of Spain and Poland who have 7.8% share of votes form the EU-G6.[450] On 23 June 2016 electorate in the UK voted in a referendum to leave the European Union. UK Prime Minister Theresa May has committed to triggering Article 50 of the Lisbon Treaty by end of March 2017 and completing the Brexit process to leave the EU within a 2-year time-frame.[451]

The United Kingdom and France, both veto wielding permanent members of the UN Security Council (UNSC) and nuclear-weapon States (NWS) as permitted under the Treaty on the Non-Proliferation of Nuclear Weapons (NPT), are the only two European Union countries with built-up capacity to influence global security issues.[452] External relations of the European Union on geopolitical matters are subject to foreign policies adopted in [453] London and Paris. The United Kingdom and France are established global geopolitical powers and recognized as such in Asia.

Germany, which has the largest economy in Europe, is the biggest contributor to the budget of the European Union thereby allowing Berlin an important say in the day-to-day working of the Institutions of the European Union. The rapidly ageing German socio-economic fabric is overdependent on export-driven growth[454][455][456] whose life-lines are directly linked to the increasingly contested European project. Assertion of German leadership within the European Union faces stiff opposition to Germany's vision for the European Union in southern and eastern European countries,[457][458] an ominous unease about a dominant Germany,[459] memories of Germany's Nazi-era legacy which remain unforgotten, and currently shifting global power-centres. Restrictions imposed through the 1990 Treaty on the Final Settlement with Respect to Germany effectively subordinates Germany to the Four Powers (USA, UK, France & Russia). General consensus within the United Nations that Europe is already over-represented within the UN Security Council is a critical obstacle for Germany's bid to become a permanent member of the UNSC.[460][461][462][463][464][465][466][467][468][469] In Asia, Germany is viewed as an established Europe-centric geoeconomic power.[470] Germany is a geopolitically insignificant entity in Asian power politics.

NHIndustries NH90 Caïman of the Marine nationale engaged in cross-deck operations from the Indian aircraft carrier INS Viraat during Indo-French joint naval exercises VARUNA 2015
Undivided India. Pre-independence map of 1922 British India by J. G. Bartholomew published in the Imperial Gazetteer of India (Clarendon Press, Oxford, England).
Map of the European Union in the world (with overseas countries and territories (OCT) and outermost regions (OMR)).

Future Perspectives

Foreign relations of India. Dark blue Countries which have key strategic, military and economic relations with India; Blue Countries which have key strategic and economic relations with India; Light Blue Countries which have favourable relations with India; Red Countries which have ongoing border/territorial disputes and/or have fought wars
Dark orange: The Indian subcontinent. Light orange: Other countries culturally linked to India, notably Burma, Thailand, Cambodia, Laos, Champa (Southern Vietnam), Indonesia, Malaysia, Brunei and Singapore. Yellow: Regions with significant Indian cultural influence, notably Afghanistan, Tibet, China's Yunnan Province and the Philippines.

On 23 February 2015, the Indian Ministry of External Affairs (MEA) published a paper [562] summarizing the current status of engagement with the European Union, listing India's national priorities, stating its core interests and outlining the direction and contours for the future EU-India relationship:

Speaking at the 2015 Shangri-La Dialogue, the Indian Minister of State for External Affairs Gen.(Rtd)V. K. Singh, opined : "It's been an interesting year for the MEA. The increased emphasis on our immediate neighbourhood was long overdue. Most importantly, I think the one message that has gone out to our own people is that Indian lives, wherever they may be, are of paramount importance. I also like to believe our missions and embassies across the globe are far more accessible to our own people than they were before. We live in a changing world where the challenges are endless. MEA is the face of this new India for the rest of the world. We have excellent people fully committed to looking after our interests in every corner of the world. The message to all Indians should be loud and clear – we are always there to look after their interests. The foreign policy has been tweaked to further the interests of India."[563]

Indian citizens being registered for evacuation from Yemen on board an Indian Navy warship during 2015 Operation Raahat

Acknowledging the changing security paradigm in Asia, the Indian Minister of State for Defence Rao Inderjit Singh, underscored the importance of national preparedness to efficiently accommodate challenges generated in the management of the global commons: "New concepts like food security, energy security, water security, information security and security of navigation have emerged in strategic discourse. We have also come to look upon natural disasters and mass epidemics as security threats, as they can often disrupt our lives and societies much more dramatically than even military threats. These new and holistic conceptions of security have led to new forms of security cooperation between nations. Earlier, countries used to secure themselves from traditional military threats by adopting forms of neutrality or by aligning themselves in mutual defence arrangements with other countries. In our age, we have evolved a new form of security cooperation, one that is based on regular, structured dialogue between different nations rather than on formal alliances."[564]

Delivering a lecture on "State Security, State Craft and Conflict of Values", National Security Adviser Ajit Doval declared: "Power is not as good as you have it, but as good as you can exercise it."[565][566][567]

Signalling that global alignment in a multi-polar world had replaced India's traditional Cold War-era foreign policy of non-alignment, Minister of State for Coal, New and Renewable Energy, Piyush Goyal stated: "The shift from 'non-alignment' to 'global alignment' was based on long-term vision and helped India gain greater acceptability in the world," and went on to clarify that India could not afford to remain isolated as a balancing power in a globalized world wherein the country was fast emerging as a leading power.[568]

In a thinly veiled warning to anti-national elements, Minister of State for Information and Broadcasting Col.(Rtd)Rajyavardhan Singh Rathore put them on notice: "India's enemies should not rest in peace. Govt will do whatever it takes to neutralise nation's enemies"[569][570]

EU28-India institutional relationship

The European Union, after the Lisbon Treaty entered into force, can be characterized as a transnational sui generis political and legal entity.[571] The Institutions of the European Union derive their authority based upon sovereign rights delegated by member states to Brussels. Institutions of the European Union have no sovereign rights but may enter into treaties (subject to ratification in national parliaments of EU member states) in those fields where competence has been fully delegated to the European Union.[572] Under international law, sovereign legitimacy resides in the national capitals of the member States of the European Union.

History

Council of Europe Schengen Area European Free Trade Association European Economic Area Eurozone European Union European Union Customs Union Agreement with EU to mint euros GUAM Central European Free Trade Agreement Nordic Council Baltic Assembly Benelux Visegrád Group Common Travel Area Organization of the Black Sea Economic Cooperation Union State Switzerland Iceland Norway Liechtenstein Sweden Denmark Finland Poland Czech Republic Hungary Slovakia Greece Estonia Latvia Lithuania Belgium Netherlands Luxembourg Italy France Spain Austria Germany Portugal Slovenia Malta Cyprus Ireland United Kingdom Croatia Romania Bulgaria Turkey Monaco Andorra San Marino Vatican City Georgia Ukraine Azerbaijan Moldova Armenia Russia Belarus Serbia Albania Montenegro Macedonia Bosnia and Herzegovina Kosovo (UNMIK) Kazakhstan
A clickable Euler diagram showing the relationships between various multinational European organisations and agreements.

India was one of the first countries to develop relations with predecessors of the European Union. In 1963, India initiated a diplomatic dialogue with the European Economic Community (EEC).[573] The Joint Political Statement of 1993 and the 1994 Co-operation Agreement were the foundational agreements for the bilateral partnership. In 2004, India and the European Union initiated a "Strategic Dialogue". A Joint Action Plan was agreed upon in 2005 and updated in 2008. India-EU Joint Statements was published in 2009 and 2012 following the India-European Union Summits.[574]

In 2014, the European Commission initiated the process of development aid 'graduation' to divert assistance away from India and other emerging and growth-leading economies in order to focus resources on least developed countries.

India and the European Commission (with a negotiating mandate from the European Council) initiated negotiations on a Free Trade Agreement (FTA) called the Broad-based Trade and Investment Agreement (BTIA) in 2007. Seven rounds of negotiations have been completed without reaching a Free Trade Agreement.[575][576][577][578][579] Civil society and public interest groups in India, Brazil and EU countries have objected to the proposed India-European Union FTA.[580][581] Burak Akçapar, Ambassador of Turkey to India opined that social clauses of the EU-India FTA will cost India $6billion in lost exports.[582]

As of November 2015, trade negotiations remained deadlocked after failing to resolve differences related to matters such as intellectual property rights (IPR),[583] the levels of permissible FDI, market access, domestic-sourcing obligations in multi-brand retail, manufacture of generic medicines, anti-dumping safeguards, greenhouse gas emissions, civil nuclear energy generation legislation, farming subsidies, replacement of traditional cash-crops with sterile genetically engineered and patented variants, regulation & safeguards for the financial and insurance sectors, cooperation on tax evasion & money laundering, overseas financing and monitoring of NGOs in India, work visa restrictions, technology transfer restrictions, cooperation on embargoes (Russia[584] & Iran), etc.

With reference to the EU-India FTA, professor Rajendra Jain of the Centre for European Studies at Jawaharlal Nehru University opined: "The reason that there was no headway in the talks was due to a mismatch of the levels of ambitions and expectations. There has to be a give and take, (...) I think the EU has had a tendency of over negotiating at times. There has to be realism in the negotiations when they resume. It is time to stop looking for a perfect deal."[585]

Brussels-New Delhi relationship

"New Delhi has very limited bandwidth for officials from Brussels, all of whom have important sounding titles but with often dissimilar perspectives on overlapping mandates"; asserted the former Canadian diplomat and Rector of the United Nations University (UNU) David Malone, bluntly assessing the qualitative effectiveness of elaborately crafted EU-India Joint Action Plans as : "these measures lead mainly to dialogue, commitments to further dialogue, and exploratory committees and working groups, rather than to significant policy measures or economic breakthroughs.".[586] Former French Foreign Minister Hubert Vedrine echoed the sentiment saying "EU spends too much time issuing well meaning statements rather than dealing with the hard realities of a rough world".[587] The former British High Commissioner to New Delhi, Sir Michael Arthur, warned that the relation with the European Union was already in a state of regress[588] because India very much sees the world in terms of Nation states; a view shared by Shashi Tharoor, presently the Chairman of India's Parliamentary Standing Committee on External Affairs, who opined that the Common Foreign and Security Policy (CFSP) of the Institutions of the European Union has little added-value to offer India over and above what it can already obtain through bilateral relations with strategic partners in Europe (France and UK continue to be influential geopolitical players as UNSC P5 members and who when joined by Germany form the EU-3 troika which accounts for the bulk of EU-India trade). "The danger is that New Delhi will write Europe off as a charming but irrelevant continent, ideal for a summer holiday but not for serious business." said Tharoor and observed that India-EU relations lack substance and strategic weight on matters of core interest to India.[589][590]

A report published in October 2015 by members of the European Council for Foreign Research (ECFR) after a field-trip to meet lawmakers, academics and entrepreneurs in India stated: "The North–South divide pits Europe as a giver of lessons against an India that often will not accept them – an India that can say "No". Add this to India's defensive and anti-interventionist international stance and Europe's increasingly centrifugal trends, and India–Europe relations begin to look like a car crash."[591]

Europe's shortcomings on the topics of law & order, human-rights and commercial practices has diminished the European Union discourse on normative behaviour and practices : concerns expressed by the United Nations regarding the treatment of migrants & asylum seekers,[592][593][594][595] shelving of cases of brutality by law & order officers, human trafficking, instances of racial profiling, opacity regarding enquiries at detention centres and of child abuse (Yarl's Wood Immigration Removal Centre, Catholic Church sexual abuse cases, Marc Dutroux Belgian paedophile trafficking network, Rotherham child sexual exploitation scandal), money laundering activities by criminal gangs, half-hearted investigations into participation by several EU-28 countries in the CIA extraordinary rendition programme, inconclusive inquiries into the illegal use of torture by or in the presence of European special forces and intelligence operatives at 'black sites',[596][597][598][599] revelations of mass surveillance programmes which indiscriminately target the private lives of ordinary citizens,[600][601] feeble prosecutions against institutions and individuals responsible for business manipulations and market distortions (price-fixings,[602] ententes,[603] cartels,[604] valuations,[605] ratings, statutory labellings[606][607][608] and subsidies misuse by oligopolies), political complaisance towards assets sheltered by HNWI in fiscal-havens and charities (trusts & foundations),[609][610][611] aggressive tax avoidance by corporations through profits transfer pricing arrangements,[612][613][614] missing trader VAT fraud,[615] money-laundering through European banks using fake-invoice trade-based techniques, continuation of institutionalized discrimination directed at ethnic groups (Rights of the Roma in the European Union and eviction of Chagossians), employment discrimination against minorities, homophobia, nepotism, etc.,

In 2014 the European Parliament consented to the appointment of Udo Voigt, a far-right MEP from Germany who has been convicted for glorifying the Nazi Party's Waffen SS, to the European Parliament Committee on Civil Liberties, Justice and Home Affairs.[616][617][618][619]

Several high-profile corporate scandals have exposed failures in Corporate Social Responsibility (CSR) wherein large conglomerates based within the European Union have manipulated and illegally bypassed health, safety, environmental or financial regulations. The 2013 meat adulteration scandal, Libor fixing scandal and 2008 Siemens bribery scandal are examples of recent scandals involving unethical business practices by European multinational corporations which have inveigled unsuspecting customers. In March 2015, Finnwatch a NGO based in Finland accused Finnish multinational engineering company Wärtsilä of suspect labour practices which included paying workers subsistence minimum wage salaries which are barely enough to live on.[620] Human rights groups and the International Labour Organization have been deeply critical of the use of forced labour provided by the military junta in the construction of the Yadana natural gas pipeline by the French oil giant Total S.A. in Myanmar.[621][622] In September 2015, US investigators revealed that German car-maker Volkswagen had illegally installed "defeat devices" in vehicles with the aim of cheating pollution control lab tests on cars that in reality emitted between 10 and 40 times the US emissions standard.[623][624] "Using a defeat device in cars to evade clean air standards is illegal and a threat to public health," said Cynthia Giles, the assistant administrator for enforcement at US Environmental Protection Agency (EPA).[625] Ferdinand Dudenhoeffer, head of the Center of Automotive Research at the University of Duisburg-Essen said: "This disaster is beyond all expectations,". According to US law firm Hagens Berman who has launched a class-action suit against Volkswagen: "While Volkswagen tells consumers that its diesel cars meet emissions standards, vehicle owners are duped into paying for vehicles that do not meet this standard and unknowingly pay more for quality they never receive,".[626]

India perceives certain aspects of European human rights agenda (social clauses) and some statutory labour requirements or precautionary measures in environmental safety as protectionist non-tariff trade barriers.[627] Recurrent trade restrictions on Indian products decided by the European Commission (around 700 generic medicines were black-listed in 2015[628][629] which followed an earlier import ban on fruits and vegetables from India in 2014[630][631]) and the European Parliament resolution in 2015 on alleged human rights violations by India are examples of recent actions which were unhelpful impediments to the improvement of European Union-India relations.

Global cumulative energy-related carbon dioxide emissions between 1890-2007. Data Source: International Energy Agency (2009)

Comparisons of per capita consumption and wastage of food, water and energy, between the European Union and developing countries quickly polarises the discourses on environment protection and climate change.[632] Pollution control is a topic where citizens within emerging economies (India, China, Indonesia) are themselves demanding that their governments act decisively on issues of air, water & soil quality with stricter legislation for industrial waste management and improved norms to tackle hazardous pollutants.

In Asia, European diplomats are perceived as pretentious and patronizing.[633] European interlocutors are said to appear stuck in the past, oblivious to 21st century Asian geopolitical realities and seemingly ill-trained to understanding Asia.[634][635] European officials are known to persist with clichéd narratives and complaints that India is under-resourced.[636][637] Both sides stand accused of arrogance.[638][639][640][641]

Visiting politicians and senior bureaucrats from South Asian countries are known to lack basic sense of social decorum and diplomatic finesse while on official representation. Lack of preparation in diplomatic protocol, cultural norms, culinary skills and restroom etiquette makes them prone to committing faux-pas to the embarrassment of their hosts, muted helplessness of embassy staff and amusement of the press-corps. Chinese officials are known to pay attention to their outward appearance and practice their roles/actions which are carefully choreographed before-hand to the minutest detail. In June 2015, an Indian Parliamentary delegation invited to the European Parliament in Brussels included a delegate who wore sports shoes to a meeting with the President of the European Parliament Martin Schulz.[642][643]

EU-India Strategic Dialogue

The under-performing European Union-India Strategic Dialogue has been qualified as high on rhetoric and low on substance.[644][645][646][647][648][649][650][651][652]

Brussels has little to interest New Delhi because the geopolitical and economic aspects of the consultative dialogue with the Institutions of the European Union are pre-adjudicated through bilateral relations with Washington, Beijing, Moscow, Paris, London and Berlin. On global security issues, French and UK foreign and defence clout easily outranks the European Union's Common Foreign and Security Policy (CFSP).[653]

Indian dialogue with Institutions of the European Union is conditioned through the lenses of bilateral strategic relationships with EU-3 countries, state of France–Germany relations, the overall European balance of power, and specific trade opportunities with sovereign member States of the European Union.[654][655][656]

The heads of State or Government of EU member states have become increasingly assertive in dealing with critical global issues and frequently bypass EU foreign policy structures on matters of national interest, thereby undermining the roles of Brussels-based actors.[657]

Historically low number of top-level visits to India by the principle figure-heads of the European Union (President of the European Council, President of the European Commission and President of the European Parliament) is an indicator of where New Delhi stands within the European Union's priorities.[658]

Indian Prime-Minister Narendra Modi travelled on official visits to France and Germany in April 2015 for strategic bilateral discussions with French President François Hollande and German Chancellor Angela Merkel. Earlier plans to meet the new leadership of the Institutions of the European Union in Brussels were cancelled.[659]

Ideologically principled statements from the Institutions of the European Union and electorally motivated European Parliament resolutions on inadequacies in minority rights & religious freedom in India, allegations of human-rights violations and differing views on bilateral trade & market access disputes, have collectively led to a frosty relationship between Brussels and New Delhi.[660][661]

Contentious trade negotiations between the European Commission and New Delhi, repetitive haranguing on Human Rights issues by the European Parliament, the inability of the European Union to be an independent global security provider or credible broker, and the impotence of the Institutions of the European Union in shaping geopolitical outcomes are oft cited reasons which have prevented the Strategic Dialogue from maturing to its full potential as a Strategic relationship.[662][663][664][665]

Fredrik Erixon, who has advised the British & Swedish governments as also the World Bank, explains that difficult trade talks are the visible part of a much wider chasm separating European Union (EU) and Asian governments: "the problems are far more about institutions and regulations than about tariffs." Ericson opines that Asia and Europe are by and large politically insulated from each other: "Europe has no real influence on Asia's political direction, being neither an inspiration nor an irritation.(...) It is not much different the other way around either, and Asia or individual Asian governments do not command much influence in Europe."[666] While Europeans complain that India is obsessed with the United States of America, Indians find it difficult to suppress frustration that Europe pays far more attention to authoritarian China than a democratic India.[667]

A study prepared in June 2015 for the European Parliament's Committee on Foreign Affairs painted a bleak outlook for the EU-India relationship in the absence of still-elusive course corrections: "An EU-India summit is not likely to happen in the short term. Moreover, extraordinary political solutions are now needed to break the deadlock, restart trade negotiations and develop strategic cooperation in security matters. Strong political and strategic understanding together with cooperation built between India and major EU Member States is not being translated at EU level. (...) Somehow, there is also a perception in India that bilateral ties with large Member States are much more important than EU-India ties and policy makers focus, therefore, on major Member States rather than the EU."[117]

Juxtaposition of the Greek sovereign debt default, mass-exodus migration crisis within the Schengen free-movement area, deft geopolitical manoeuvring by a resurgent Russia, and high-profile cases of corporate fraud have severely dented European Union's standing in the world and raised questions about Europe's ability to manage problems at home.[668][669]

Spillovers from national agendas onto EU-India dialogue

Historic rivalries, regional alignments during the Cold War era and domestic socio-economic considerations have instilled a sense of paranoia in most Asian countries when it comes to border issues.[670][671][672][673] Fishermen operating in historic fishing grounds frequently have their boats and equipment impounded by maritime agencies from India, Sri Lanka, Pakistan and Bangladesh for fishing in disputed coastal waters.[674] The smuggling of contraband items (especially arms & ammunition by militias and separatist outfits), the 2008 Mumbai attacks by sea-borne terrorists, the appearance of privately contracted armed security personnel (PCASP)[675] and loosely regulated floating armouries in the Indian Ocean region has made India adopt a rigid stance on matters of maritime security and transport of weapons. Increased militarisation of the Indian Ocean has seen the Government of India reassert jurisdictional control over maritime boundaries and review the operational management of sea-lanes and maritime zones. While India has consistently endorsed the freedom of navigation and overflight in international waters and airspace, it has demanded improvements in the management of legitimate air/sea traffic and stricter monitoring of vessels flying a flag of convenience.

Background & context

Determinants which influence relations between Europe and India.

Current state of affairs

GoI@Delhi

GoI@Brussels

EU28@Brussels

EU28@India

Ancillary Developments

Political
Maldives Bangladesh Bhutan Nepal Sri Lanka India Myanmar Thailand Cambodia Laos Vietnam Brunei Indonesia Malaysia Philippines Singapore Afghanistan Pakistan Turkmenistan Iran Azerbaijan Kazakhstan Kyrgyzstan Tajikistan Uzbekistan China Russia Turkey Japan Mongolia South Korea Bahrain Kuwait Oman Qatar Saudi Arabia United Arab Emirates South Asian Association for Regional Cooperation Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation Mekong–Ganga Cooperation Association of Southeast Asian Nations Shanghai Cooperation Organisation Turkic Council Economic Cooperation Organization Gulf Cooperation Council Asia Cooperation Dialogue
A clickable Euler diagram showing the relationships between various Asian regional organisations vde
Membership and expansion of the Asia Cooperation Dialogue (ACD)
Trade
Treemap of exports from India.
Defense & Security

India

Jana Gana Mana national anthem of India

Country Profile

Population graph of India is lotus shaped (Source: United Nations World Population Prospects 2014 )
Indian middle class: 77% of Indian households are expected to have annual income ranging from 90,000-1,000,000 Indian rupees ($1650-$18,350) by 2025, up from 45% in 2005 Source:McKinsey Indian consumer goods market report[910]
The GDP contribution of various sectors of Indian economy have evolved between 1951 and 2013, as its economy has diversified and developed.

Statistical SWOT data useful to understanding India.

Total population: 1.271 billion which equates to one-sixth (17.5%) of the world's population

Indian nominal GDP is ranked 7th. ($2.25 trillion/€2.086tn) in the world and PPP GDP is ranked 3rd. ($8.72 trillion/€8.086tn). Sectorial GDP growth in 2015 for Agriculture +17%, Industry +29.7% and Services +45%

Median age of the population is 25.1 years. 29.1% are aged less than 15 years [911] with over 50% aged under 25 years and 65% below the age of 35. 158 million are within the age group of 0–6 years.

13 million new job seekers enter the labour market each year[912]

45,000 doctors graduate annually in India according to Medical Council of India.[913] 360,000 engineers graduate annually from universities and institutes recognised by the All India Council for Technical Education of which about 35 per cent were computer-science engineering students.[914][915]

The Indian middle class is generally accepted to be around 60 million households (5% to 6% of the overall population).[916][917]

In 2006, 22 percent of Indians lived under the poverty line.[918][919]

Majority of Indians live outside urban population centres. At the 2001 census 72.2% of the population[920] lived in about 638,000 villages[921] and the remaining 27.8%[920] lived in more than 5,100 towns and over 380 urban agglomerations.[922]

Overseas Indians:[923] 21,909,875 ; NRI: 10,037,761 ; PIO: 11,872,114

Religions: Hindu 80.5%, Muslim 13.4%, Christian 2.3%, Sikh 1.8%, Buddhists 0.8%, Jains 0.4%, others 0.7%, unspecified 0.1% (2001 Census) [924][925][926][927]

Languages: 22 languages are recognized as official languages. In India, there are 216 languages with more than 10,000 native speakers.

Transformative reemergence

Main article: Indian Century
Bahá'í Lotus Temple, located in New Delhi, India. Structural engineering consultancy undertaken by Flint & Neill, UK.

India has often been described as a noisy democracy with incessant and rumbustious activism.[928][929][930][931] The ever-growing availability of internet access, participative social-media journalism, a myriad of radio & television stations and massive print media has led to a culture where political debate has become an integral part of Indian society. Indians, while conscious of their colonial past as subjects of the Mughal Empire and European powers thereafter, are rapidly discarding contemporary ideas about India's place in the world.

Public opinion in favour of a strong and united India received a boost following the disintegration of the Soviet Union. The rapidity with which economic and political structures became dysfunctional in breakaway Republics of the Soviet Union alerted Indians to the hazards of secession. The shaping of Indian development along traditional societal values was prompted by the persistence of economic turmoil in Western countries which laid bare intellectual fault-lines of uncontrolled capitalism[932] and the destructive nature of unrestricted consumerism.[933][934][935][936][937][938] The credibility of Western nations as guardians of democracy and human rights nose-dived following revelations of torture and prisoner abuse in Iraq, Afghanistan and black sites.[939][940]

The Indian economy has sailed through global economic turmoil relatively unscathed due to its low exposure to global markets, maturation of domestic markets and orthodox asset management by domestic financial institutions. India's two largest banks are both headed by women CEOs : Arundhati Bhattacharya at State Bank of India and Chanda Kochhar at ICICI Bank.

Indians take pride in their country's civilizational past, the primacy of democratic structures of governance and the ongoing developmental progress.[941]

Indians rank among the most optimistic in the world with regards to their economic future [942][943] and view education as a passport to a good life.[944]

Strategic relationships

British Aerospace Hawk 132 advanced jet trainer aircraft of the Indian Air Force at Toulouse, France

The Republic of India is an Asian leader in its own right and has been unwilling to subordinate itself to anyone else.[945] While India aspires to achieve geopolitical and commercial parity with China, it has at the same time been unwilling to align its national interests to serve global or regional powers.[946][947]

India is not part of any military alliance. In 2012, the Attorney-General of India informed the Supreme Court that the Government, following a well-settled principle of State policy, steadfastly refuses to enter into any SOFA-like military treaty or alliance with other countries.[948] In August 2015, India publicly reiterated this principle at an ITLOS hearing in Hamburg.

Strategic assets under the purview of the Indian Nuclear Command Authority provide a credible second-strike capability beyond strengthening land borders and securing unrestrained access to air/sea lanes of communications. Transformation efforts, through infrastructure modernisation and skills capacity-building, are under-way in all branches of the Indian Armed Forces to acquire air-sea-land dominance capabilities necessary to exercise control over the 15,200 km (9,445 mi) land frontier and 7,517 km (4,671 mi) coastline.

INS Vikrant currently being fitted-out at Cochin Shipyard is the lead-ship of Vikrant-class aircraft carriers for the Indian Navy

Bulk of global maritime trade passes through two sea lines of communication choke-points which are close to India : the Six Degree Channel adjacent to the Andaman and Nicobar Islands dominates the entrance to the Strait of Malacca and the Nine Degree Channel located between Lakshadweep Islands and the Indian mainland sees the passage of nearly all merchant shipping between Europe, the Middle-East and Western Asia (which face the western Malabar seaboard of India) and South-East Asia and the Far-East (which stretches out beyond India's eastern Coromandel seaboard).[949]

The 4,056 km (2520 mi) long disputed land border between India and China, called the Line of Actual Control (LAC), remains an important policy determinant in Sino-Indian relations. The Narendra Modi government has been ambivalent in its dealings with China: concurrently pursuing policies to steadily augment bilateral commerce and trade in non-strategic sectors, while standing firm on matters of national security and publicly competing with China for regional influence.[950][951][952] India has rejected joining any China containment grouping but has clearly signalled that India will ascertain that its core trade and security interests are not constrained by a Chinese-dominated security configuration in the Indo-Pacific.[953][954][955][956][957][958][959]

History is an important determinant in modern India's political and commercial relations with countries in its neighbourhood. Starting from the Mughal era and through the course of the British Raj several colonies, settlements and protectorates in the Indian Ocean region were at different times administered from India. For a major part of the 20th century the Indian Rupee and Persian Gulf rupee, both minted in India, was the legal tender of many countries in the Indian Ocean region (Aden, Oman, Dubai, Kuwait, Bahrain, Qatar, the Trucial States, Kenya, Tanganyika, Uganda, the Seychelles and Mauritius).

India has over 30 strategic relationships and include the European Union, ASEAN, Russia, China, Brazil, South Africa, Japan, South Korea, France, United Kingdom, Germany, USA, Iran, Israel, Oman, Saudi Arabia, UAE, Nigeria, Mauritius, Seychelles, Vietnam, Afghanistan, Tajikistan, Turkmenistan, Kazakhstan, Nepal, Bhutan, Myanmar, Indonesia and Australia.[960][961][962][963][964]

In November 2011, The Foundation for National Security Research in New Delhi published India's Strategic Partners: A Comparative Assessment and ranked India's top strategic partners with a score out of 90 points : Russia (62) comes out on top, followed by the United States of America (58), France (51), UK (41), Germany (37), and Japan (34).[2]

Substantial Indian diaspora in Nepal (14.7% of Nepalis), Myanmar, Malaysia (8.7% of Malaysians), Fiji, Mauritius (68.3% of local population are of Indian origin), United Arab Emirates (30% of the UAE population[965]), Saudi Arabia, Bahrain (19% of Bahrainis) and Oman (17.5% of Omani population) gives India strategic leverage[966][967] in the Indian Ocean region. Narendra Modi has signalled that he values the Indian diaspora.[968][969] Affirming its responsibility to protect,[970] the Indian government has taken a firm stance on human security by asserting that it will react decisively using all instruments of foreign policy (diplomacy and military power projection), if the well-being of the citizens or the overseas diaspora is adversely affected.[971]

The Government of India has intervened overseas at times of humanitarian crisis (2015 Operation Maitri in Nepal, 2014 Operation Neer in Maldives) and to assist Indian diaspora and citizens of neighbouring countries in conflict zones (2015 Operation Raahat in Yemen, 2011 Operation Safe Homecoming in Libya, 2006 Operation Sukoon in Lebanon and the 1990 Gulf War airlift from Kuwait-Iraq. Guinness World Records lists the 1990 Gulf War air-lift of 170,000 Indians (by India's national air-carrier Air India) as the largest air-evacuation in history.[972]

Regional geopolitics, energy security considerations, absence of United Nations consent for sanctions, and a fundamental divergence of perspectives on root-causes (Atlanticist driven expansion of European Union & NATO)[973] have conditioned Indian participation on the sanctions regime against two of India's foremost strategic partners: Russia[974] and Iran. Iran plays a prominent role in India's plans to unlock abundant energy supplies and mineral resources in Central Asia, besides providing a bridgehead to rival the China-Pakistan Economic Corridor (CPEC).[975][976][977][978]

In 2010, the President of the United States of America Barack Obama, declared his firm belief that the US-India relationship will be shepherded into "one of the defining partnerships of the 21st century."[979]

2014 Indian General Elections

Main article: Politics of India
What are the factors which create poverty in India? Ambassador Danièle SMADJA, Former Head of the Delegation of the European Union to India.

The 2014 Indian General Elections, a monstrous affair with 815 million registered voters (66,38% turnout); 8230 candidates; 543 electoral constituencies; 11 million election personnel,[980] saw the political emergence of the upwardly mobile 20-something generation (close to half of the 1.25 billion Indian population is aged under 25-years), record numbers of first-time voters, greater participation by women, extensive use of Social media, the fading importance of caste-politics and erosion of hereditary vote-banks.

2012 Jan Satyagraha non-violent protest to demand access to land and livelihood resources for poor landless, homeless and marginalized communities

Whilst sustainable development, inclusive economic growth and fight against corruption were the main topics of concern to the Indian electorate, other concerns which influenced voters were cross-border insurgencies, freedom & rights of minorities and media, access to basic health-care & medicines, education infrastructure & skills development, food security, land-use & ownership, environment management & pollution control, fishing rights & maritime security, fresh-water management, availability and price of fuel & energy security and maritime security. The elections transformed the Indian political landscape by ushering in a Government whose electoral manifesto promised a corruption-free growth-centric economic revival.

Long-term economic and labor policy towards sustaining the self-employed livelihoods of millions of small land-owning/land-holding cash crop farmers and small family-run convenience stores against unequal competition and financial subservience to business conglomerates in the FMCG, multi-brand retail and agrochemical sector became a major focus area during the election campaign. Political parties have increasingly become sensitive to civil uprisings in rural electoral constituencies where State and Central government policies have failed to tackle widespread bureaucratic corruption, stem farmers' suicides and lower debt bondage.[981]

Total suicide rates per 100,000 people in India (BLACK) compared against farmer suicide rates (GREEN). Source: Gruère, G. & Sengupta, D. (2011), Bt cotton and farmer suicides in India: an evidence-based assessment, The Journal of Development Studies, 47(2), p.316-337

India Against Corruption protests led by Anna Hazare in 2011 and 2012, prompted the BJP and AAP to adopt good governance as the basis for their election campaign and prepared the platform for investigations into allegations of corruption, hoarding of black money and tax avoidance by multinational corporations or high-net-worth individuals (HNWI). Netizens orchestrated a name and shame campaign of corrupt officials within government departments using internet based tools such as the popular whistle-blower anti-graft website IPaidABribe.com.[982]

A series of ghastly sexual crimes (including the highly publicised Nirbhaya case) affected collective conscience. The failure to prosecute politically connected individuals in criminal cases eroded public trust in the judicial system.

Percent labor employment in India by its economic sectors (2010).[983]

BJP promised to crack down on the notoriously work-shy civil servants, transform the lackadaisical work atmosphere in government offices, scrutinize links between bureaucrats and business houses & corporations, curb perks of top bureaucrats, punish officials misusing public property & privileges (red beacons on personal vehicles, free-memberships to recreational clubs, free-tickets to commercial events, assigning government staff for private work, etc.), and link careers of government employees to job attendance and performance.[984][985][986][987][988] Foreign visits and study tours by bureaucrats and ministers are to become linked to concrete outcomes.[989]

Trust in the UPA government nose-dived in the aftermath of the 2010 Wikileaks Cablegate[990] disclosures which exposed the depth of US access and links to senior Indian bureaucrats and politicians (with instances mentioning children and close relatives who live in the USA or work for American companies). The 2013 Edward Snowden whistle-blower campaign laid-bare the extent of US government surveillance assets and capabilities targeting India.

Italian-born Sonia Maino-Gandhi the matriarch of the Nehru–Gandhi family, a polarizing figure-head and the de facto head of the UPA coalition Governments of Manmohan Singh till 2014, is facing a leadership succession crisis within the Indian National Congress (INC) party.[991][992] Regional and State-level allies of the INC who were UPA coalition partners, sensing the mood of the people, have disassociated themselves from Rahul Gandhi.[993] Entrance into politics by Priyanka Gandhi-Vadra is fraught with uncertainty due to ongoing investigations into business dealings brokered by her husband Robert Vadra.[994][995][996][997][998] The INC, after dominating Indian politics for most of the post-Indian independence period, faces an uncertain future.[999] The political elimination of dynastic heirs from prominent political families who have dominated Indian politics for decades (Palaniappan Chidambaram, Salman Khurshid, Oscar Fernandes, Sachin Pilot) has resulted in the advent of a new breed of Indian politicians who feel no obligation to stick to traditional approaches and constraints in domestic and foreign relations. Shashi Tharoor is weighed down by an ongoing investigations into the unnatural death of his wife Sunanda Pushkar.

Boycott of Narendra Modi

Narendra Modi was the Chief Minister of Gujarat between 2001 and till the Bharatiya Janata Party victory in the 2014 Indian General Elections following which he was appointed as the Prime-Minister of India in 2014.

In the aftermath of the 2002 Gujarat riots, Western diplomats in India held Narendra Modi complicit for administrative inaction. European diplomats as well as visiting European Union politicians and officials refused to meet Narendra Modi from 2003 till the 2012 announcement by the Special Investigation Team (SIT) that it could find no "prosecutable evidence" against Modi.[1000][1001][1002][1003][1004] The Indian Supreme Court cleared Narendra Modi of all responsibility for the riots.[1000][1005]

During the 10-year long boycott of Narendra Modi by the European Union and USA, the Chief Minister built-up foreign investment and trade relations with China, Japan, South Korea and Taiwan. Between 2001 and 2014, Gujarat forged ahead on all economic indicators with double-digit industrial growth and saw Narendra Modi re-elected 4 times as Chief Minister of Gujarat .[1006] One of the world's leading news magazines TIME, in its edition of 26 March 2012, had Narendra Modi on its cover page with a story titled "Modi Means Business".[1007]

BJP-led NDA government

The BJP-led NDA coalition government has a clear majority in the Lok Sabha (lower house of parliament) but is weak in the Rajya Sabha (upper house of parliament). The BJP government announced a roadmap of improvements to implement electoral promises and make India more attractive to overseas investors and entrepreneurs.[1008]

Prime Minister Narendra Modi has promised to "create an India that none could talk down to in the international stage."[1009]

From the time of assuming the leadership of India, Narendra Modi has managed to keep the radical Hindutva fringe of the BJP party under control, rein in overzealous Ghar Wapsi activities and forestall any damage to his legacy by as Prime-Minister of India caused due to religious or minority related strife.

Narendra Modi initiated Mann Ki Baat a monthly radio address and revamped the website of the PMO to allow for direct interaction with the Prime Minister [1010] and encourage citizens to participate actively in improving the nation.

In May 2015, the NDA government published a progress report of its first year in office. While public endorsement for the conduct of foreign relations by NDA government and the raising of India's stature in the world has been widespread, opinions are evenly divided on the scope, pace and results of economic reforms.[1011][1012] The weakest areas, where the government has the least to show in terms of improvements, are in the domains of law & order and human rights (log-jammed judicial system, brutality & abuse of detainees by police & security forces, human trafficking & illegal trade of organs, crackdown on sexual & hate crimes, and gender equality).[1013][1014]

The NDA government is yet to fulfil its pre-electoral promise to fully declassify files related to Subhas Chandra Bose,[1015] the Indian nationalist who became the leader of Azad Hind, and attempted to secure India's independence by leading the Indian National Army against Britain during WWII. Narendra Modi had pledged that the files would be released so as to settle the controversy regarding the disappearance of the freedom fighter.[1016]

The biggest challenge to the current BJP-led NDA government comes not from the decimated Indian National Congress party,[1017][1018][1019][1020] but instead from the young Indian electorate who expect that the Modi government deliver on his 2014 electoral campaign promise : Achhe din anne wale hain (English: Good days are coming).[1021][1022]

On a personal level, Narendra Modi's vanity could lead to his undoing with the domestic electorate and overseas interlocutors and has led to highly visible 'own goals' : the notorious name-bearing Modi suit worn during Obama's visit to India, obsessive use of selfies on social media which borders on spamming, propensity to claim ownership of existing programmes and ideas through re-branding, etc.

In September 2015, an opinion survey conducted by Pew Research Center revealed that support for Narendra Modi in India stood at 87% and was highest among two crucial demographic groups: 18- to 29-year-olds and rural Indians.[1023][1024]

Human capital development & Diaspora

Narendra Modi has reached out to the diaspora to reverse the brain drain of intellectuals and promising students.[1025][1026][1027]

The UNDP estimates that India loses $2 billion a year because of the emigration of computer experts to the U.S.[1028] Indian students going abroad for their higher studies cost India a foreign exchange outflow of $10 billion annually.[1029]

Overseas Indians file more patents in their country of residence than in India.[1030] Thomas Friedman, in his recent book, The World is Flat, explains this trend in terms of brain drain, whereby the best and brightest elements in India emigrate to the U.S. in order to seek better financial opportunities.[1031] A joint study by Duke University and UC Berkeley revealed that Indian immigrants to the US have founded more engineering and technology companies from 1995 to 2005 than immigrants from the UK, China, Taiwan and Japan combined.[1032] A 1999 study by AnnaLee Saxenian reported that a third of Silicon Valley scientists and engineers were immigrants and that Indians are the second largest group of Asian-born engineers (23%) following the Chinese (51%). Her research showed that in 1998, seven percent of high-technology firms in Silicon Valley were led by Indian CEOs.[1033] A recent study shows that 23% of Indian business school graduates take a job in United States.[1034]

Income creation in the USA through knowledge-based employment by Asian Indians has outpaced every other ethnic group according to U.S. Census data.[1035] Indian American households are the most prosperous in the USA with a median revenue of US$88000, followed by Chinese Americans at US$65000. The average household revenue in the USA is US$50000.[1036]

Administrative reform

While on the 2014 general elections campaign trail, Narendra Modi popularized the slogan of "Maximum Governance, Minimum Government." Investor surveys conducted by Hong Kong-based Political & Economic Risk Consultancy Ltd. had ranked India's paper-pushing Babu bureaucracy as the worst among 12 Asian countries for almost two decades.[1037]

Immediately after his ascension as Prime Minister of India, Modi told a gathering of the most senior civil service bureaucrats that their careers and advancements are linked to their abilities to demonstrate leadership attributes within their ministries and successfully implement government policies.[1038] Narendra Modi consolidated his grip over the Cabinet Secretariat which runs the Indian bureaucratic system by keeping key portfolios within the purview of the Prime Minister's Office (PMO) and thereby making it the nerve-centre of the BJP government.[1039]

Modi reined in corporate access to senior government offices and has declared that he is committed to making public administration more transparent and efficient. Modi issued directives ordering bureaucrats to refrain from social venues while on government duty and attend to government work from their offices.[988][1040][1041]

Expressing unhappiness over the pace and scope of bureaucratic reforms, the Cabinet Committee on Security (CCS) disbanded the Planning Commission, sidelined under-performing officials through bureaucratic reshuffles and unceremoniously curtailed the careers of several senior-most bureaucrats including Foreign Secretary Sujatha Singh and Director General of DRDO Avinash Chander. Senior officials who became involved in controversies have either been fired or demoted to less prestigious postings as was the case with Home Secretary Anil Goswami and the former Indian Deputy Consul-General in New York Devyani Khobragade.[1042]

Economic & trade policies
Self-employment through a family-owned spice-shop in Varanasi.

Presenting the Union Budget of India for 2014–2015, Finance Minister Arun Jaitley announced that the government would pass legislation to crack banking secrecy in foreign tax havens and verify discordances[1043] in the lifestyle of government officials against their known and declared sources of income.[1044][1045][1046] Emphasis was laid on the creation of value-addition and employment opportunities at the level of Micro and Small Scale Enterprises in India.[1047] The Indian budget for 2015-2016 is built upon the assumption that the country can sustain a growth rate of 7% to 8%.[1048]

Narendra Modi, known for thinking out of the box on foreign policy issues,[1049][1050] had cultivated relations with the overseas Indian diaspora and engaged the leadership of China when he was the Chief Minister of Gujarat from 2001 to 2014. A Neighbourhood first policy which included a significant refocus on Sino-Indian relations with the view of a rapprochement was announced during the Swearing-in ceremony of Narendra Modi on 26 May 2014. In August 2014, Foreign Minister Sushma Swaraj unveiled the Act East policy as the continuum to the Look East policy. India aspires to be a "leading power, not just a balancing power" explained Foreign Secretary Subrahmanyam Jaishankar, reflecting on the importance of bordering States by saying "you cannot be a leading power if your neighbourhood is not with you, you need it to root for you."[1051]

Modi set into motion a process to renew [1052][1053] and rebalance foreign relations depending upon India's national interests and 21st century realities.[1054][1055] The recalibration of relations is based upon emerging opportunities for cooperation in a multi-polar world where India has better representation [1056] and also in the ability of individual countries to participate in the Post-2015 Development Agenda through delivering economic growth in India.[1057]

The PMO of Narendra Modi overhauled[1058] the MEA in order to transform Indian diplomacy from a reactive bureaucracy to a proactive & entrepreneurial mind-set along the models of JETRO (Japan), KOTRA (South Korea) and TAITRA (Taiwan).[1059] Officers posted to Indian Missions overseas were ordered to act as force multipliers for the Indian economy by focusing on issues like identifying of market opportunities, foreign trade promotion & facilitation for Indian companies, overseas acquisition of energy supplies, securing raw-materials for domestic manufacturing industries and safeguarding multi-modal air-sea-land trading routes. In June 2015, the government announced that it intends to build capacity at the MEA through recruitment from academic circles and the private sector.[1060]

European Union

Ode to Joy anthem of European Union
European Union

This article is part of a series on the
politics and government
of the European Union

The European project is in a state of flux with ever-increasing risks of political Balkanization.[1061][1062][1063][1064][1065][1066][1067]

Socio-political challenges to the European project

Poor economic growth across the European Union has led to mounting Euroscepticism,[1068] the rise of Xenophobia,[1069][1070] and successful electoral challenges to the devolution of power from sovereign Member states of the European Union to Institutions of the European Union.[1071][1072][1073][1074][1075][1076][1077] France, Italy, Spain, Portugal, Poland, Hungary, Slovakia, Czech Republic and Greece have signaled that they will not permit the transfer of any more sovereign powers to the Institutions of the European Union[1078][1079][1080] with the UK going as far as scheduling a referendum on 23 June 2016 to decide on whether to stay or leave the European Union.

Unscheduled change of governments in EU countries due to the debt crisis
Unscheduled change of governments in Euro countries (marked RED) due to European sovereign debt crisis
Per capita transfers to/from EU member states through EU budget for the years 2007-2013. BLUE countries were net donors; RED countries were net recipients. The larger the country the more each inhabitant of the country will contribute/receive. (Source: Eurostat)
Banner by migrants showing an appeal for tolerance: We the people of Sudan are not criminal, just people who ran away from war.
National government positions on the 2015 European Union immigration quota plan for asylum seekers in the EU
  Approval
  Opt-out (de facto refusal)
  Refusal

Economic setbacks and deficiencies

Shadow economy per capita in the European Union (Source: Eurostat & University of Linz)
Unemployment rates in selected European countries and in the EU28 between January 2004 and April 2014.(Source: Eurostat)[1196]
Anti-Euro Plus Pact protest on 19 June 2011 at Plaza de la Virgen Blanca, Vitoria-Gasteiz, Spain.
Debt-to-GDP ratio of European Union countries (Source: Eurostat, 31 May 2015)
Debt profile of eurozone countries
Debt profile of eurozone countries

Several EU member-states are in economic decline in both relative and absolute terms leading to a de facto Multi-speed Europe.[1197][1198][1199][1200] Persistence of low economic growth and increased cost of living have affected the level of disposable incomes and domestic debt-to-savings ratios.[1201] Globalization has brought increased competition in both internal and export markets for companies based within the European Union.[1202] European Union growth stimulus policies - artificially created monetary expansion to combat deflationary pressures through credit & fiscal easing - is only postponing absolute economic decline and burdening future generations with humongous debt repayments in the absence of innovation-led growth.

Unbalanced demographics and lopsided Employment-to-population ratio has resulted in extension of the retirement age, applied budgetary pressure on social security & welfare service systems (medicare, pensions), and accelerated rural depopulation. Increasing skill-erosion of the employable workforce due to technology evolutions is impacting all segments of value-addition.[1203] Stiff competition for market-access and ever-growing difficulties to retain market-shares in the global arena is impacting businesses who are unable to afford the sustained capital investment requirements for continuous product development, quicker time-to-market and superior customer management. Constraints linked to continuous skills-development and latencies in transforming legacy processes, technologies and infrastructure have had a direct impact on employment and market opportunities.[1204]

Re-localization of manufacturing infrastructure by multinational corporations (MNCs) to low-cost countries has led to de-industrialisation. The reduction of human intervention through automation of production and logistics processes has reduced employment opportunities.[1205][1206] Differing taxation regimes[1207] within the European Union have led to aggressive tax optimization and avoidance by conglomerates and small and medium-sized enterprises.[1208] Favourable commercial tax credit agreements[1209][1210][1211][1212] and the rampant misuse of special purpose entity (SPE)[1213] based in certain EU28 member States (UK, Ireland, Netherlands, Luxemburg & Belgium)[1214][1215][1216] have allowed large corporations to avoid,[1217] minimise or indefinitely defer tax dues.[1218][1219] Populist movements all over the European Union have campaigned for policies which target loopholes allowing tax avoidance by transnational corporations and scrutinize incentives and subsidies given to factories where automation of manufacturing processes has improved productivity and enriched share-holders but diminished job prospects for non-specialized workers.[1220][1221][1222][1223] Governments have been slow to move away from neoliberal policies and adopt measures which advance the public good of local communities through public-private initiatives which nurture grass-roots innovation, promote social partnering entrepreneurship and sustain job creation in self-employing SMEs.

Creditors of Greece between 2011 and 2015 (Source: Wiener Zeitung, June 2015[1228]
Digital Agenda for Europe

Highlighting the social implications of the global competition for intellectual capital, rapid improvements in education & technology assimilation, the dominance of Asian countries in Lights out semiconductor foundries and ICT sectors and the massive demographic advantage which countries like India & China have leveraged as they move up the technology ladder[1245] and bridge existing technology gaps; Thomas Friedman reflected on the changing times in Western societies saying : "my parents used to say to me: Finish your dinner -- people in China are starving. I, by contrast, find myself wanting to say : Finish your homework -- people in China and India are starving for your job."[1246]

Close to a million jobs are expected to lie vacant in Europe by 2020 due to a lack of technological skills, according to the European Commission which warns that Europe is not graduating enough IT specialists to keep up with demand.[1247] Flagging the importance of tailoring education in Europe to skills requirements at every point of the value-addition Smiling curve, the European Commission adopted the Europe 2020 programme and initiated the implementation of the Digital Agenda for Europe.[1248]

Latest OECD rankings of proficiency in arithmetic and sciences has seen European 15-year-old school students trail their Asian counterparts: the top 5 spots being taken by Singapore, Hong Kong, South Korea, Japan & Taiwan.[1249][1250]

L'Atelier, an open access road-mobile Fab lab involving University of Technology of Compiègne deployed to the 2015 Libre Software Meeting in Beauvais, France.

Schools are refocusing education curricula around STEM sciences and emerging technologies to meet the skills requirements of Industry 4.0. Schools in the UK are introducing software code building right from elementary school (Scratch being the most popular learning tool used to introduce children to software programming). Universities are generalizing the Fab lab concept where continuous project-work in mechatronics amalgamates software coding, electronics and telecommunications with materials and manufacturing technologies.

Student interns and junior managers are being encouraged to accumulate experience of living and working in foreign markets to gain a better understanding of inter-cultural differences.[1251]

Nick Gibb, England's Schools minister says: "We want all schools to consider the needs of their pupils to determine how technology can complement the foundations of good teaching and a rigorous curriculum, so that every pupil is able to achieve their potential." Tom Bennett, the UK government's expert on pupil behaviour, said teachers had been "dazzled" by school computers. Andreas Schleicher, education director at the Organisation for Economic Co-operation and Development, urged schools to ensure that children gain a good grasp of reading, writing and mathematics, opining that school technology had raised "too many false hopes (...) If you look at the best-performing education systems, such as those in East Asia, they've been very cautious about using technology in their classrooms," (...) Those students who use tablets and computers very often tend to do worse than those who use them moderately.". In September 2015, a survey conducted by the OECD into the impact of heavy investments in digital technology within the classroom, showed that Pisa test results for reading, mathematics or science showed "no noticeable improvement".[1252] In October 2015, a study by researchers at the University of Washington, Stanford University and the Mathematica policy research group discovered that on-line pupils fell far behind counterparts who studied within the classroom. The National Study of Online Charter Schools found "significantly weaker academic performance" in maths and reading in 'virtual schools' when compared with the conventional school system.[1253]

Faraduino, an Arduino compatible educational robotics toy developed by Middlesex University Teaching Resources (UK).

Open-source microcontroller (Arduino) and single-board computer (Raspberry Pi) platforms have kick-started public interest in hackerspaces and initiated a maker culture all over the world. Social transformations are expected as collaborative innovation through cost-effective manufacturing facilities using 3D printing, laser cutting and CNC machining which are already helping home-based entrepreneurs to rapidly prototype crowdsourced products and measure product attractivity through crowdfunding mechanisms.[1254][1255]

Public perceptions

In Asia, the positive public perception of Europe is highest in India.[1]

Institutional bias and discriminatory behaviour against minority groups and persons of color continues to persist in Europe.[766][767][1256][1257][1258][1259]

The tendency of Western social academics to over emphasise the importance of the caste system for all matters pertaining to India has made Europeans prone to explaining away India via the caste system.

The morbid fascination of European tourists with Hindu cremation rituals is perceived as lack of sensitivity besides being a gross invasion of privacy. Hoards of tourists flock to cremation grounds on the banks of the Ganges, especially in Varanasi (Bénarès), to photograph funeral pyres.

Asian countries are often the object of populist rants against cheap imported goods using exploited labour who live in miserable poverty. Low-cost imports from Asian countries artificially augment the purchasing power capacity of European consumers while concurrently allowing multinational companies and corporate traders to make disproportionately large profits. In 2013, the Wall Street Journal exposed the exploitative operating margins of Western branded-apparel retailers - who sourced garments from Asia - as being between 5 and 20 times the price paid to the manufacturer.[1260]

India suffers from a severe image deficit in Europe.[508][1261]

Results of 2014 BBC World Service poll.
Views of India's influence by country[1262]
Sorted by Pos-Neg
Country polled Positive Negative Neutral Pos-Neg
 Germany 16 68 16 -52
 Spain 20 50 30 -30
 Israel 9 34 57 -25
 France 40 49 11 -9
 Canada 38 46 16 -8
 China 27 35 38 -8
 United Kingdom 45 46 9 -1
 United States 45 41 14 4
 Brazil 41 36 23 5
 Turkey 35 29 36 6
 Indonesia 47 24 29 23
 Japan 34 9 57 25
 Russia 45 9 46 36
 Nigeria 64 22 14 42

See also

Wikimedia Commons has media related to International relations of India.
Wikimedia Commons has media related to India - European Union relations.

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