EUROPEAN UNION, RELATIONS WITH

EUROPEAN UNION, RELATIONS WITH India and the European Union (EU) have shared historical links, political institutions, and a liberal ethos. India's independence and the initiation of the efforts to achieve regional cooperation in Europe both began shortly after World War II. India was among the first countries to recognize the then six-member European Economic Community (EEC), a precursor of the EU. Since then, India has enjoyed many areas of convergence with the EU, ranging from social and cultural relations to economic and political matters. Still, there are many problematic areas of divergence on which both parties will have to work diligently to ensure future cooperation.

Overview of Relations

The table below reflects the slow progression in EU-India relations. After an initial period of stabilization and cautious foreign relations, India established formal diplomatic relations with the EEC in 1963. Besides historical ties, the values of democracy and pluralism were significant promoters of this relationship. With India's policy of nonalignment, this relationship was peripheral during the cold war. Prime Minister Indira Gandhi fully realized the potential significance of economic, cultural, and political cooperation with Western Europe. She was successful in evolving bilateral relations with France and former West Germany, but these agreements were country specific and could not reach the wider European community.

The first major economic assistance came in 1970 when the EU contributed 147 million euros to the Operation Flood Programme for dairy development in India. In 1973, India and the EEC signed their first Agreement on Commercial Cooperation. In 1971, India was included in the Generalized System of Preferences (GSP) program of the EEC. Another Agreement for Five-Year Economic and Commercial Cooperation was signed in 1981. The evolution of the European Community as a political organization thus led to the establishment of closer political and trade relations with India. It was agreed formally to institute an India-EEC Political Dialogue with the establishment of the EEC delegation in New Delhi in 1983. Despite of all these developments, the bilateral relationship remained limited to certain economic areas.

The end of the cold war era placed both India and the EEC in a new environment without ideological barriers. The EEC was formally transformed into the European Community (EC) under the Treaty of European Union (EU), which took effect on 1 November 1993, leading to deeper political and economic integration of the European nations. The EU also moved toward the adoption of a common currency and common foreign and security policies. In 1991 India also started implementing its economic deregulation and liberalization program, emerging as a major economic player in the global market, with a huge potential for investment. As a giant in information technology (IT), India provided additional impetus for the improvement of bilateral relations based on complementary interests.

India's first comprehensive agreement with the EU came into force in August 1994, with the signing of their Cooperation Agreement between the European Community and the Republic of India on Partnership and Development. That agreement covered issues that included respect for human rights and democratic principles; development and diversification of trade and investment; cooperation on technical, economic, and cultural matters; sustainable social progress and poverty alleviation; and support for environmental protection and sustainable development. Concrete steps toward these objectives were clearly stated in a communication approved by the council of the commission on EU-India Enhanced Partnership in 1996. The same year, India's Trade and Investment Forum was held in Brussels, jointly chaired by EC vice president Manual Marin and Indian minister of commerce B. B. Ramaiah. Indian minister for external affairs Jaswant Singh's visit to Brussels in 1999 was another landmark in strengthening relations. Meanwhile, India-EU political dialogue was elevated to the Foreign Ministerial level and institutionalized through the Troika mechanism, comprising of the current EU presidency, the succeeding president and the previous president. The EU-Troika started holding annual talks with India on major bilateral and

LANDMARKS IN INDIA–EU RELATIONS

The list was compiled with the help of Milestones in EU–India Relations, available at <http://www/delind.cec.eu.int/en/political_dialogue/milestones.htm> and bilateral documents available at the site of Ministry of External Affairs, India, <http://meaindia.nic.in>

international issues. European commissioner for trade Pascal Lamy visited Mumbai and New Delhi in 2000, which led to the first EU-India summit that year.

That summit was held in Lisbon on 28 June 2000, and wide-ranging issues of political, economic, developmental, and environmental significance were discussed. The Joint Summit Declaration further ensured such summit meetings of foreign ministers every year to examine all impediments to trade and investment in India, with a view to removing them. The second summit convened in New Delhi on 23 November 2001, focusing on strategic and international issues. Its Agenda for Action was a joint statement on international terrorism, with both sides agreeing to help one another in facing the current international situation, with specific reference to Afghanistan and Pakistan. Initiatives on the economic front were striking. Some of the economic landmarks included a joint statement regarding trade and investment, the signing of an agreement on scientific and technological cooperation, and the adoption of a statement on information technology. The third EU-India summit met in Copenhagen on 10 October 2002, reviewing the challenges and possible responses in areas of regional and global peace, the integration of developing countries into the global economy, and issues related to civil society, including poverty alleviation, health care, and education.

EU Trade Commissioner Pascal Lamy played a very significant role in normalizing the bilateral trade issues when he visited India on 13–14 March 2003. The fourth EU-India summit was held in New Delhi, India, on 29 November 2003. Besides pluralism, democracy, and the multipolar world, both sides have reiterated their commitments toward strengthening the role of the United Nations (UN) in the maintenance of international peace and security, the common fight against terrorism and transborder crimes, and the UN Convention on Climate Change. In the changed global context, intense cooperation to promote peace, stability, and reconstruction of Afghanistan and Iraq also became the important points of discussion in the summit.

The fifth summit between the EU and India was held in the Hague, the Netherlands, on 8 November 2004. The focus of this summit was rich and diversified cultural traditions enjoyed by both sides. There was an agreement to work toward the elaboration of a specific chapter on cultural cooperation within the EU-India Action Plan for Strategic Partnership. Successful conclusion of the Customs Co-operation, progress in the negotiations on Maritime Agreement and strategic dialogue on the Information Society was reviewed. The EU-India Action Plan for Strategic Partnership was also drawn in this summit, focusing on the regional and international dimensions of fight against terrorism.

Areas of Convergence

Sociocultural cooperation

The vast English-speaking and technologically skilled population of India, along with the interest of European scholars in studies pertaining to Indian society and culture, forms the basis of sociocultural ties between India and the EU. After their first summit at Lisbon, a think-tank network and an India-EU Round Table were established to discuss social and civil issues. The first EU-India think-tank seminar declared that the EU and India share common goals in the battle against poverty and the welfare of marginalized sections of society. An EU-India Economic Cross Cultural Programme (ECCP) was initiated, with the overall objective of strengthening and enhancing civil society links and cross-cultural cooperation through dialogue between European and Indian media and cultural organizations and by supporting educational and cultural activities. The European Union Film Festival held in New Delhi (6–13 October) and Kolkata (19–25 October) 2000, on the theme of "The City," and the parallel conference on "Cities of Tomorrow" demonstrated mutual concerns over urban planning and sustainable development. Jawaharlal Nehru University's European Studies Programme, with an EC support of 590,000 euros (approximately 30 million rupees), an EC contribution of 200 million euros to the Indian universal elementary education program, and attempts by scholars and the media to change stereotypical depictions of an underdeveloped India in the European media all pointed to the emergence of closer social and cultural ties.

Political and strategic concerns

At the political and strategic level, India and the EU have shared values of democracy, pluralism, commitment to multilateralism, the reformation of international organizations, and a common concern over terrorism and the protection of human rights. According to the EU-India Joint Statement on Political Dialogue adopted in 1994, both sides are committed to defending democracy, human rights, and a peaceful, stable, and just international order in accordance with the UN Charter. In the Declaration against International Terrorism made on 23 November 2001, India and the EU reiterated their commitment to cooperation against international terrorism.

Science and technology

India's inability to realize its goal of complete self-reliance, and the failure of the EU to match the United States and Japan in science and technology during the last half century, provided a foundation for bilateral cooperation in that field. The Agreement for Scientific and Technological Cooperation adopted by the EU council on 25 June 2002 was based on the principle of mutual benefit and reciprocal opportunities. This agreement will enable both India and the EU to share experience and utilize each other's technology for poverty eradication, food security, and environmental sustainability. The conferment of observer status to India at the Council of the European Organization for Nuclear Research (CERN) was a sign of cordial and confident bilateral relations. Information and Communication Technology (ICT) has been another mutually beneficial area of cooperation between the EU and India, both jointly agreeing to establish the Software Service Support and Education Center at Banglore to promote India-EU joint ventures in information technology. The Joint EU-India Vision Statement on Development of the Information Society adopted on 23 November 2001 led to the establishment of the EU-India Working Group on the Information Society, which will work toward enhancing human capacity development, knowledge creation and sharing, and training in related fields.

Trade and economy

At the first bilateral summit, low levels of trade and the need for joint efforts to increase its potential were stressed. A joint initiative was adopted, in which four sectors were specified for potential investment: food processing, engineering, telecommunications, and IT. India exports textiles, jewelry, leather goods, chemicals, and agricultural products to the EU, while India imports chemicals, engineering goods, metal products, and transportation equipment from the EU. After the process of liberalization, and thanks to multilateral trading under the auspices of the World Trade Organization (WTO), EU-India trade increased from 9,975 million euros in 1991 to 25,032 million euros in 2001, a phenomenal growth of 150 percent. By 2003 the EU accounted for a quarter of India's imports and exports and was the largest source of foreign direct investment.

Areas of Divergence

WTO

Though the WTO has brought about greater trade at the multilateral level, the historical legacy of development process has made the WTO negotiations as a point of confrontation for both the sides. As a developed market the EU is seeking greater tariff reduction and more trade facilitation while representing the interests of developing countries. India always supported tariff reduction and inclusion of larger issues within the WTO ambit only after the phased elimination of support subsidies to the farmers of the developed countries. These differences were evident in the Fifth Ministerial Conferences of the WTO at Cancun and later negotiations.

Nuclear nonproliferation

After India's nuclear tests in 1998, nuclear nonproliferation has been an issue of contention between India and the EU. The joint communiqué of the second EU-India summit reiterated "unequivocal commitment to the ultimate goal of complete elimination of nuclear weapons." However, India has a principled stand against any discriminatory approach to nuclear nonproliferation. The EU as a whole had reacted sharply and bitterly against India's nuclear tests and expects unconditional acceptance of the Comprehensive Test Ban Treaty, which India has refused to accept. After five years of tests, it is still not clear whether India and the EU will be able to accommodate and adjust to each other's positions on this issue.

International power relations

India and the EU have their own realistic interests and perceptions of international power relations, and their consequent behavioral differences have affected their relations. Principally, India has always perceived the EU as the shadow of the United States, while India is perceived by the EU as a strategic ally of Russia. India has, moreover, consistently opposed undemocratic practices in governing international institutions, primarily the UN, the International Monetary Fund, and the WTO. The EU is not ready to forgo the superiority built up by its members in creating these institutions. On the question of its own bilateral relations with Pakistan, India has consistently opposed the EU's policy of collaborating with military rulers in the international war against terrorism.

India has genuine concerns over the violence abetted by Pakistan in Jammu and Kashmir, the reformation of the UN and the WTO, and the regional protectionist policies of the EU in agriculture and textile sectors. At the same time, the perception of India as a strategic and business partner is still largely negative within the EU. India is considered a country with administrative impediments and unethical, nontransparent practices in trade-related matters. At the political level, India is known as a country with uncertain and inconsistent policies due to enormous domestic pressures and constraints. India will have to speed up its internal reforms in social and economic matters, while building a positive image as democratic and commercially vibrant country. It will have to review its policy of focusing only on the EU's larger countries, like France, Germany, and the United Kingdom, while ignoring smaller countries of enormous trade potential, like Belgium, the Netherlands, and Italy. More importantly, both sides will have to transcend the historical legacy of colonialism and the inherent conflicts between developed and developing countries, and they will have to strengthen communications and institutional mechanisms to address their mutual disagreements and concerns.

Prafulla Ketkar

BIBLIOGRAPHY

"EC Country Strategy Paper, India." Available at <http://europa.eu.int/comm/external_relations/india/csp/02_06en.pdf>

"EU-India Enhanced Partnership." COM (96) 275. Brussels: Commission of the European Communities, 26 June 1996.

"India's Foreign Policy: Western Europe." Available at <http://www.indianembassy.org/policy/Foreign_Policy/weuro.htm>

"Milestones in EU-India Relations." Available at <http://www/delind.cec.eu.int/en/political_dialogue/milestones.htm>

SECONDARY SOURCES

Bhattacharya, Swapan K. "European Union's Trade with Asia and India: Prospects in the New Millennium." Paper presented at the international seminar on "The European Union in a Changing World," School of International Relations, Jawaharlal Nehru University, New Delhi, 6–7 September 2001.

Chaturvedi, Sachin. "India, the European Union and Geographical Indications (GI): Covergence of Interests and Challenges Ahead." Paper presented at the international seminar on "India, the European Union, and the WTO," organized by Centre des Sciences Humaines, EC Delegation, Fundacao, Oriente, JNU European Union Studies Project, and Konrad Adenauer Foundation, at Jawaharlal Nehru University, New Delhi, 16–17 October 2002.

Jain, Rajendra K. "India and the European Union." In India, Germany and European Union: Partners in Progress and Prosperity, edited by Naushad Anwar Sulaiman. Delhi: Kalinga Publication, 2002.

Katyal, K. K. "Strong Case for Enhancing India-EU Relations." Hindu, 26 November 2001.

Ram, A. N. "India and the European Union." World Focus 21, no. 5 (May 2000): 9–12.

Singh, Jasjit. "India, Europe and Non-Proliferation: Pokhran II and After." Strategic Analysis 22, no. 8 (November 1998): 1111–1122.