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Visitors from Europe

Publication Date : 26-02-2013


Two major European leaders, President Hollande of France and Prime Minister Cameron of the UK, have recently been in India, with economic issues foremost on their agenda. Europe is struggling with recession and has to find ways of revitalising its flagging economic performance, and it looks towards India as a likely market and partner.

In India itself, the mood about the economy is less upbeat owing to slowdown, scandal and uncertainty, but yet it remains on an upward path and a steady procession of foreign leaders continues to arrive, in search of business opportunity and stronger economic ties.

The British and French visits can be seen as part of this chain, though their present task, especially for France, is to firm up earlier deals and to bring to fruition what may have been already agreed in principle. The most prized French deal involves that country’s Dassault company which was successful in a keenly contested bid for a major order of military aircraft for India, winning out against several other bidders, including some from Europe.

This agreement now needs to be put into operation, which is a complicated and testing exercise. Some of the unsuccessful bidders are still snapping at the heels and may not  have entirely abandoned the effort to induce a re-think by India. The financial stake is huge and tying down the arrangement may have encouraged Hollande to come to India so early in his presidential term.

To judge from his comments after his meetings in New Delhi, the French president felt something had been achieved, and some progress in implementing the agreement could now be anticipated. It is worth recalling that France has been a reliable supplier of military equipment from the early days, when India wanted to broaden its sources of supply, and it has not used arms supply as a lever to push policy choices in other fields, which has not always been the case with other Western suppliers.

Apart from arms, France is very much in the picture for the supply of nuclear power plants. It is a global leader in this field and obtains much of its own electricity needs from this source, so could be hopeful of finding a good market in India when changing international priorities permitted, even encouraged, India to shop globally for nuclear power plants. However, public support in India for nuclear energy is limited and many vocal non-official citizens’ groups, responding to accidents and mishaps in different parts of the world, have lobbied vigorously against any major expansion in this area.

Parliament itself has taken the lead in demanding far-reaching safeguards, which has been a considerable discouragement to potential suppliers. Notwithstanding, President Hollande indicated that his country might be able to work with Indian regulators in finding a way forward. This is a complicated matter where both sides would seem to be interested in taking matters forward though there is no easy road ahead.

These two big ticket items, aircraft and nuclear energy, both turn on government-to-government understandings, and the two sides are already actively engaged with each other. Less has emerged from the efforts of private parties to develop economic and commercial links among themselves. The president was accompanied by a large delegation of business leaders who met Indian counterparts in Mumbai though no significant result has yet been announced. The French private sector has not had the impact in India that had been hoped for, and commercial transactions have not reached the level that both desire.

Following close on the French president, Prime Minister Cameron came to India with many comparable preoccupations. Like others in Europe, Britain is trying to find its way out of the crippling recession and needs to strengthen its economic engagement with partners abroad. Unlike France, however, Britain has not won large contracts for the supply of advanced equipment to India: it was part of the European consortium that ran France’s Dassault close on the aircraft deal but ultimately did not prevail.

For Britain, India represents not a market alone but also a significant source of investment, something that Mr Cameron was clearly eager to encourage. Like Mr Hollande, he was accompanied by a large business delegation and brave words were spoken about doubling commercial exchanges in the coming years.

India-UK ties have many particular facets and Cameron did not permit the current focus on commercial issues to drive everything else off the page. He was bold enough to go to Jallianwala Bagh on a visit of atonement, a well-intentioned move that earned appreciation in India even though the relationship between the two countries is in good shape even without such a gesture.

He announced liberalisation of the UK’s visa regime to encourage Indian students and to enable suitably qualified ones to stay longer upon completing their course of studies. Until quite recently, the UK was the preferred destination for Indian students headed abroad, making up  a body of individuals that came to constitute an invisible but strong link between the two countries.

However, the Indian student community in the UK has dwindled as studying in that country has become progressively more expensive while obtaining the necessary permission to study has become more difficult. As a result, other countries that offer high grade education in the English language have taken a bigger share of India’s students abroad, at the expense of the UK. Reversing this trend was one of Cameron’s objectives, and what he announced in India should be welcomed.

Taken together, the visits by the leaders of France and the UK were a reminder that Europe remains a major source of technology and economic partnership for India. India’s rise over the last decade and more has re-balanced the relationship and placed it on a more productive path.

During the recent visits we heard none of the unnecessary and unwelcome advice about internal issues that has so often in the past served as an irritant: it  is now a more equable and balanced relationship that serves the important interests of both parties.

There are still major international issues where India and Europe may not see eye-to-eye--indeed, Europe itself may be internally divided in its counsels. The future of Afghanistan after the US withdrawal next year is one such issue where the UK recently took a diplomatic initiative to bring together different Afghan parties in a quest for a future modus vivendi. India was not part of that consultation but this did not have the adverse fallout that might have taken place earlier. Overall, both visits had a good impact and speak well of the general state of relations between India and Europe.

The writer is India’s former Foreign Secretary


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