The Hindu Business Line : State of the India-EU dialogue

Where do Brussels and New Delhi go from here? Will the "advancement" of bilateral relations be in the garb of a free trade arrangement or take the form of a wider CECA?

At one level, it can only be good for the planet if India and the European Union were to form closer bilateral ties, not merely in the economic sphere but also in areas outside the economic domain.

The simple justification for this would of course be that the greater the cooperation among members of the international community, the greater would be the benefits for the world at large.

At a more detailed level, closer cooperation between Brussels and New Delhi would not merely bring a chunk of the world's population closer to each other, but both the parties would, by virtue of the closer links, gain entry (or consolidate their presence where an entry has already been gained) into different continental matrices, perhaps leading to greater bonding among the different regions of the world.

Foot in Europe Affairs

To pursue this line of global reasoning further, closer ties with Brussels would imply that New Delhi would probably have a foot in European affairs so to speak, which would without fail stand it in good stead if and when issues of, say, national security cropped up in European discussions, or in discussions between Europe and the US. In other words, the EU would be mindful of Indian interests when discussing various subjects with countries other than India, which cannot but be seen as a favourable outcome for New Delhi.

Alternatively, there is already an effort to get the EU into SAARC (South Asian Association of Regional Cooperation), which would certainly be of great help to Brussels in its objective to project itself more forcefully on the Asian stage — a stage that will be the scene of activity of the "emerging economic giants" such as China and India in the years ahead.

Indeed, Brussels has already made some headway in this direction with it being accorded "observer status" in SAARC ("with India's support," as stated in the implementation report on the Joint Action Plan drawn up at the fifth India-EU summit held in New Delhi last year).

The immediate fallout of this will be the presence of the EU as an observer at the 14{+t}{+h} SAARC summit to be held in New Delhi in April 2007, which could have an important bearing on EU-South Asian relations in the years to come.

No key support

Seen in this perspective, it was rather disappointing that the Prime Minister, Dr Manmohan Singh, was unable to extract firm statements of pointed support for New Delhi's nuclear arrangement with the US, which is still in the works and which would have received a boost had Brussels expressed unqualified support for it, or even backed it indirectly.

On the contrary, the implementation report on the joint action plan referred to India "formally (becoming) a participant in the ITER project on fusion energy with the full backing of the EU," with the joint statement welcoming "the recently established EU-India Security Dialogue, held for the first time in May 2006, as a useful and important forum for an in-depth exchange of views on global and regional security issues, including disarmament and non-proliferation, as well as bilateral issues of common concern."

In para 10, the statement drew attention to the "shared interest" of the two entities "in working together as partners for disarmament and for countering the proliferation of WMD and their delivery systems," a sentiment which could have been written with equal effect and impact two decades ago.

It would have been so much better from New Delhi's point of view had Brussels agreed to include an encouraging reference to the on-going India-US nuclear-technology negotiations which, however, was not to be. It can be argued that perhaps it is too naïve to expect such direct support on an issue which is not only extremely complex per se but which has also raised a lot of controversy in the US itself at a time when elections to the Congress are around the corner.

Even if this point is conceded, there is no reason why more substantive and structured suggestions could not be made on the future shape of India-EU trade, investment and business contacts which, among other things, would have had the effect of the Helsinki summit strengthening the `grassroots content' of the Strategic Partnership between the two sides.

Some Hope

It is not that this area has been left entirely untouched by the joint statement.

On the contrary, some hope has been held out, in the process masking, it would appear, serious differences on issues affecting a fruitful economic exchange.

Among other things, the statement has drawn attention to the growing contact at the `micro-level' — "the steady, significant intensification of the dialogue between the strategic partners."

Harping on the same theme, it says that the "level of engagement between India and individual EU members states has...been qualitatively enhanced" and "practical steps taken (to set up) a number of new consultation mechanisms," adding that "EU-India cooperation will be further enhanced through efforts to work towards facilitating the movement of businesspersons, professionals and tourists, as well as researchers, scientists, students and academics between India and the EU member states."

Top Priority

At the `macro-level', the point has been made that the successful outcome of the Doha Round "remains their foremost trade policy priority," the two sides agreeing to ensure that "the deepening of bilateral trade relations supports the larger multilateral trading regime."

Clearly, what this means is that whether it is a free-trade arrangement that is being aimed at or whether the objective is a comprehensive economic cooperation agreement (CECA), the Doha `development dimension' will have to be kept in mind, a point that has been repeatedly emphasised by the Union Commerce Minister, Mr Kamal Nath, in recent times.

Indeed, it is reported that the Commerce Minister had to burn the midnight oil to bring his EU colleagues around to adopt some sort of a common platform, without which the summit would have been an abject failure.

The question is: Where do Brussels and New Delhi go from here? Certainly, the summits will keep rolling and the "strategic partnership" will continue to be "strengthened" further, resulting in mutual diplomatic spin-offs for both the sides. But the proof the pudding will lie in the precise form the "advancement" of their "bilateral trade relations" will take, namely, whether such progress will be in the garb of a free trade arrangement or will take the form of a wider CECA?

It will not be surprising if Brussels prefers to strike a deal on the trade front which may not go by the World Trade Organisation book.

One would expect New Delhi not only to resist such pressures but also to cajole (if that were possible) the EU into accepting a wider trade and investment arrangement, which would make it subscribe to the Doha Development Agenda through the back door as it were.

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