European Commission President Ursula Von der Leyen has reached out to New Delhi stating that the first trip for her new term would be to India to upgrade strategic relationship.
The timing of her statement, delivered at the World Economic Forum in Davos on Tuesday, is significant as it comes just a day after US President Donald Trump came up with his `America First Trade Policy’ threatening supplemental tariffs on its trade partners, soon after he was sworn in.
“..the first trip of my new Commission will be to India. Together with Prime Minister Modi we want to upgrade the strategic partnership with the largest country and democracy in the world,” she said in her special address at the WEF.
Von der Leyen’s announcement of her intended visit to India follows a two-day high-level India-EU trade and investment dialogue in Brussels last weekend where the two sides agreed to increase the pace of negotiations for the India-EU Free Trade Agreement.
The world has entered a new era of harsh geostrategic competition with major economies vying for access to raw materials, new technologies and global trade routes, the EC President said without naming any country.
Balancing act
“As this competition intensifies, we will likely continue to see frequent use of economic tools, such as sanctions, export controls, and tariffs, that are intended to safeguard economic and national security. But it is important that we balance the imperative to safeguard our security against our opportunity to innovate and enhance our prosperity. In this spirit, we will need to work together to avoid a global race to the bottom,” she said.
In his `America First Trade Policy’, Trump said the US Secretary of Commerce and the US Trade Representative shall investigate the causes of US’ large and persistent annual trade deficits in goods, and its economic and national security implications and risks, and recommend appropriate measures, such as a global supplemental tariff or other policies, to remedy such deficits.
US’ trade deficit with India in FY24 was at $35.32 billion with India’s exports to the country valued at $77.51 billion and imports at $42.19 billion.
India’s exports to the EU bloc in FY 24 was valued at $75.93 billion while its imports were at $61.48 billion.