Chancellor Olaf Scholz is visiting India for the third time, emphasizing the importance of Indo-German relations amid global challenges. Scholz and Prime Minister Narendra Modi aim to strengthen ties through trade and cooperation, particularly in defense and skilled labor. With India’s economy surging and its strategic position in the Indo-Pacific, Germany views India as a key partner. Despite differing stances on the Ukraine war, both countries seek to enhance collaboration, including negotiations for a free trade agreement.
Chancellor Scholz Visits India: Strengthening Ties and Exploring Opportunities
Chancellor Olaf Scholz is making his third trip to India alongside various cabinet members, underlining the significance of the bilateral relationship. The Chancellor and Indian Prime Minister Narendra Modi are expected to set a collaborative tone during their discussions. Scholz has been actively pursuing a closer relationship with Modi since inviting him to the G7 summit in Elmau in 2022, leading to multiple meetings on international platforms and private discussions.
According to Tobias Scholz from the German Institute for International and Security Affairs, their professional bond is evident, as both nations recognize each other as vital trading partners amid a complex global landscape. The Chancellor emphasized their shared vision during recent Indo-German government consultations in Berlin, highlighting the strong connection between the two countries.
Historically, Indo-German relations have flown under the radar, but a renewed focus is now evident.
Building Confidence
These government consultations, ongoing since 2011, are pivotal in fostering trust. They aim to identify common ground and address differences. An Indian foreign minister raised a thought-provoking point two years ago about the Ukraine war: why should India be concerned about Europe’s issues if Europe shows little interest in Asia’s challenges?
Both countries face significant threats—Germany contends with a Russian aggressor, while India is wary of an assertive China seeking dominance in the Indo-Pacific. “Germany and India can learn a lot from one another regarding how global politics shapes our foreign policy,” noted Tobias Scholz.
India’s Economic Ascent
Scholz arrives in India, a country making headlines for its remarkable economic growth, particularly after the IMF projected zero growth for Germany this year. With an impressive growth rate of nearly seven percent, India is the fastest-growing economy among G20 nations and recently surpassed China as the world’s most populous country.
While Germany’s infrastructure struggles, India is making impressive strides by constructing eight airports and multiple metro systems annually, along with daily freeway expansions. These figures may evoke some envy from Chancellor Scholz.
Future Collaborations
On the Chancellor’s government plane, ten entrepreneurs accompany German Economics Minister Robert Habeck, who played a crucial role in reigniting interest in India as a trading partner following a long hiatus. Germany is keen to harness India’s rapid economic growth, reflected in the 14 percent increase in exports to India in 2023, establishing Germany as India’s leading trading partner in Europe.
Furthermore, Germany aims to diversify its economic partnerships and reduce dependency on China, while India is asserting itself as more than just an alternative to its northern neighbor. This context emphasizes the Chancellor’s push for a long-awaited EU-India free trade agreement, which has been in negotiation for 13 years. “I want decisive progress in these discussions,” the Chancellor remarked during his last visit to New Delhi.
Potential in the Defense Sector
A key area for potential collaboration is the defense industry. With Russia as India’s largest arms supplier, Prime Minister Modi sees substantial opportunities for defense cooperation with Western nations, including Germany. India is currently in discussions to acquire six German submarines, and success in this billion-euro deal during the consultations would be groundbreaking.
For the first time in decades, the Indian Air Force recently engaged in joint exercises with European forces, including operations involving Bundeswehr Eurofighters and Airbus tankers. Additionally, German naval vessels will dock in Goa during the Chancellor’s visit, signaling a strategic focus on the vital Indo-Pacific region amid rising tensions with China.
Ukraine Conflict and Stances
Germany has taken note of India’s reluctance to publicly condemn Russia’s aggression towards Ukraine, particularly its decision to abstain from UN votes. However, Foreign Minister Annalena Baerbock acknowledged Modi’s statement at the G20 summit advocating for peace, interpreting it as India’s acknowledgment of the issue.
“Actions speak louder than words,” noted Defense Minister Pistorius, emphasizing that India has been clear in its foreign policy stance. While India’s ties with Russia seem robust, they are strategically balanced.
India’s Skilled Workforce: An Asset for Germany
Labor Minister Heil’s participation in the delegation underscores the importance of skilled labor migration. Following the first-ever migration agreement between Germany and India two years ago, the Chancellor hailed it as a model for global practices. Germany is in dire need of skilled workers, particularly from India, which has seen a remarkable influx of 52,000 Indians receiving German visas in 2023—a 40 percent increase compared