Following his meeting with Indian Prime Minister Narendra Modi on Monday in Ahmedabad, Merz said he believes it is possible that the EU and India could unexpectedly sign a planned free trade agreement as early as the end of this month.
"The President of the European Commission and the President of the European Council will travel to India at the end of the month and, if the agreement is finalized by then, will also sign it," Merz stated. He added that the EU leaders would in any case seek another major breakthrough to bring this free trade agreement to fruition. Up to now, negotiations had been expected to conclude by the end of the year. However, following "very intensive talks" between Merz and Modi, there are now "high expectations" in German government circles that an agreement could indeed be signed by the end of January.
One reason for the momentum is seen as pressure from US tariffs on India. Without naming countries such as the USA or China, Merz said that the "renaissance of the unfortunate protectionism" is damaging, especially for Germany and India. This, he said, is why closer cooperation is necessary. For the EU, signing the agreement would mark another major success after last week's conclusion of the EU trade deal with South America's Mercosur states.
This also has a positive impact on bilateral relations: Energy company Uniper signed a contract in India for the purchase of up to 500,000 tons of ammonia annually. The ammonia is to be converted into hydrogen in Germany. Uniper announced on Monday that its partner is the company AM Green.
In the presence of Merz and Modi, the defense ministries of both countries also signed a memorandum of understanding for increased cooperation between their defense industries. Airbus Defence is already active in India, while Thyssenkrupp's defense subsidiary TKMS is hoping for orders for six submarines, with an option for three more, by the end of March. Until now, India has been heavily dependent on Russian arms supplies.
The German Ministry for Economic Affairs signed a memorandum of understanding with India's Ministry of Mines to cooperate on critical minerals. In general, the "CEO Forum" is intended to deepen economic relations with India. Meanwhile, the Health Ministry signed an agreement to recruit Indian professionals for the healthcare sector.
"Close cooperation between countries like Germany and India is important for all of humanity," Modi said at a joint media appearance, during which the Indian side again did not allow questions. Modi particularly emphasized the importance of stronger technological collaboration. "India and Germany agree that, to address global challenges, reforms of international institutions are absolutely necessary," he added, referring to the UN Security Council. Both countries are calling for a permanent seat on the highest UN body.
"We share fundamental values. The highly dynamic India and the technologically leading country Germany, we share essential interests," Merz said.
The two countries are celebrating the 75th anniversary of their diplomatic relations. Merz announced that Modi will travel to Germany at the end of the year for German-Indian government consultations.
(Contributed by Tom Käckenhoff; edited by Christian Götz. For questions, please contact our editorial team at berlin.newsroom@thomsonreuters.com (for politics and economics) or frankfurt.newsroom@thomsonreuters.com (for companies and markets).
- by Andreas Rinke
