India

Last updated in September 2011

Political relations

Following the Second World War, India was the first country to end the state of war with Germany and among the first to grant the Federal Republic of Germany diplomatic recognition. It demonstrated sympathy and support for German reunification. India regards united Germany as an important partner in its quest for a new political role in the region and the world.

Mutual high-level visits have given relations a considerable impetus. The first Indian Prime Minister Jawaharlal Nehru visited Germany as far back as 1956 and 1960. There followed visits by President Narayanan (in 1998), Prime Minister Gandhi (in 1988), Prime Minister Rao (in 1991, 1993 and 1994) and President Venkataram (in 1989). Prime Minister Vajpayee paid a visit to Germany in May 2003. Prime Minister Manmohan Singh visited Germany in April 2006 and December 2010.

The most recent high-ranking visits on the German side were those by Federal President Köhler from 1 to 7 February 2010 and Federal Foreign Minister Westerwelle from 16 to 19 October 2010 and from 29 to 30 May 2011. Prior to this, there were visits to India by Federal Foreign Minister Steinmeier from 19 to 21 November 2008, by Federal Chancellor Merkel from 29 October to 1 November 2007 and by Bundestag President Dr. Lammert in August 2007. Other official visits to India were that by Federal Chancellor Schröder (in 2001 and 2004), Federal President Rau (in 2003), Federal President von Weizsäcker (in 1991) and Federal Chancellor Kohl (in 1983, 1986 and 1993).

Federal Chancellor Merkel visited India from 31 May to 1 June 2011, accompanied by seven ministers/parliamentary state secretaries, to take part in the first Indo-German intergovernmental consultations. Apart from Israel, India is the first non-European country with which Germany practises this form of close partnership.

The Agenda for Indo-German Partnership in the 21st Century, which was signed by the two countries’ Foreign Ministers in May 2000, sets out potential areas for intensifying bilateral relations. Since 23 April 2006, this has been supplemented by a Joint Declaration by Federal Chancellor Merkel and Prime Minister M. Singh on strategic partnership between the two countries. Besides providing for closer coordination on regional and global policy, e.g. on Afghanistan, Iran, disarmament, fighting terrorism, climate protection and the reform of the United Nations, this partnership is designed to markedly step up cooperation in the business and energy sectors as well as in science, technology and defence. On 30 October 2007, during Federal Chancellor Merkel’s visit to India, a Joint Statement on the Further Development of the Strategic and Global Partnership was issued.

The signing of a cooperation agreement by the two countries’ defence ministers in September 2006 extended the strategic dialogue with India by a further component: military policy. A High Defence Committee meets once a year at state secretary level to approve specific defence cooperation measures, which have previously been drawn up by sub-working groups. In addition to the dialogue on military policy, cooperation also extends to the armed forces and the armaments sector.

An important milestone in Indo-German relations is the German Year – officially entitled “Germany and India 2011-2012: Infinite Opportunities” – which being held in India from autumn 2011 until autumn 2012 to mark the 60th anniversary of the establishment of diplomatic relations between the Federal Republic of Germany and India (on 7 March 1951). Federal Chancellor Merkel officially opened the German Year in New Delhi on 31 May 2011 during her visit to India. The German Year is being co-organized by the Federal Foreign Office, the Goethe Institute, the Asia-Pacific Committee of German Business and the Federal Ministry of Education and Research. At each of seven key locations – New Delhi, Mumbai, Kolkata, Chennai, Pune, Bangalore and Hyderabad – Germany will present a varied two-week programme, also making use of a mobile event space, showcasing it as an innovative, creative and sustainable partner of India under the overall motto “StadtRäume–CitySpaces”. The programme will include cultural events, high-level political visits and presentations by business, science and research. Further information on participation is available at: external link, opens in new windowwww.goethe.de/delhi/dui

Economic relations

In recent years, economic relations between Germany and India have markedly gained momentum and increased in intensity. The visits to India by the Federal Chancellor in late October 2007and at the end of May 2011, by the Federal Foreign Minister in November 2008, October 2010 and at the end of May 2011, by the Federal Economics Minister in September 2010 and by the Federal President in early February 2010, all accompanied by high-ranking business delegations, reaffirmed the mutual interest in further intensifying economic relations.

Germany is India’s principal trading partner in the EU. Since India embarked on a course of reform in 1991, the volume of trade between the two countries has increased rapidly. Given the considerable potential for growth, it is hoped to increase the volume of bilateral trade to EUR 20 billion by the end of 2012. In 2010, bilateral trade was worth EUR 15.4 billion (exports amounting to EUR9.2 billion, an increase of 14 per cent, and imports EUR 6.2 billion, an increase of 21 per cent), a rise of 17% compared with the previous year (EUR 13.2 billion). India ranks 26th among Germany’s trading partners for imports (up from 29th in 2009) and 21st for exports. Germany is India’s principal trading partner in the EU and ranks 8th as both a supplier to and buyer of goods from India. Germany’s trade surplus of approximately EUR 3 billion testifies to the strong Indian demand for German goods, especially capital goods (machinery), which account for some one-third of Germany’s total exports to India, and motor vehicles. Important groups of goods in bilateral trade include chemical products and electrical goods as well as precision engineering products und optical goods. Strong growth rates were recorded for aircraft, foodstuffs, motor vehicles and machinery as well as for electrical and optical goods.

Indian exports to Germany focus on the textile sector, followed by chemical products, leather goods, foodstuffs, iron and iron goods and motor vehicles.

The most recent meeting of the Indo-German Joint Commission on Industrial and Economic Cooperation, co-chaired by the German Economics Minister and India’s Finance Minister, was held in New Delhi on 23 September 2010. Accompanied by nearly 50 corporate and business association heads, the Indian Finance Minister called on German companies to step up their engagement in India. The talks focused on the issues of trade facilitations, export controls, individual investment projects, a further opening of markets, vocational and technical training measures by German companies and intensifying cooperation in the energy, infrastructure, tourism and environmental sectors.

Along with the Energy Forum, which was set up in 2006, the working groups on coal, tourism and infrastructure are making important contributions to intensifying economic relations with India. Cooperation within the Indo-German Energy Forum in particular has since attained a depth and breadth that sets Germany apart among India’s trading partners.

In late 2008 and early 2009, a total of three Indo-German working groups, on technical and vocational training and the automotive and agricultural sectors, commenced work with high-level government involvement.

The main Indo-German economic agreements include:

• Double taxation agreement, which came into force on 19 December 1996
• Agreement on the promotion and protection of investments, which came into force in July 1998
• Trade agreement of 31 March 1955
• Agreements on cooperation in scientific research and technological development of 1971 and 1974

German direct investment

For decades, Germany has been among the ten principal foreign direct investors in India. With investments totalling USD 3 billion since April 2000, it currently ranks 8th, after Mauritius, Singapore, the USA, the United Kingdom, the Netherlands, Japan and Cyprus. Investments have focused on the transport, electrical and metal sectors. In recent years, the service sector (in particular insurance) has headed the field, with a share of some 26 per cent, followed by the construction and automotive industries (VW, Mercedes and BMW). According to official Indian figures, new German direct investment in the financial year 2010/11 amounted to USD 200 million, compared with USD 626 million in the previous year. However, this figure only takes into account direct money flows, not indirect investment, and thus in no way reflects the real engagement of German companies, which are expanding their capacities, in particular through reinvestment.

Investment focuses on the chemical and pharmaceutical sectors, machine and plant construction, electrical engineering and software.

Indo-German development cooperation

Germany’s development cooperation with India is a major component of its foreign policy relations. Like all developing countries experiencing rapid economic growth, India faces a number of serious challenges, particularly in the following areas:

- achieving broad impact of growth

- infrastructure

- education and training

- environment

With its population of more than 1.2 billion, India is an indispensable partner in efforts to protect global public assets such as climate. There are, then, numerous intervention points for targeted cooperation to improve people’s living standards.

In its efforts to make its development cooperation efficient and give it a clearer profile, the German government has agreed with the Indian government on the following priorities:

• environmental protection and the conservation of natural resources
• energy
• sustainable economic development (including developing the financial sector and social security)

Germany’s development cooperation measures are carried out by the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) and the KfW Development Bank (KfW Bank Group) on behalf of the Federal Ministry for Economic Cooperation and Development (BMZ) and in consultation with the Federal Foreign Office. The GIZ focuses on Technical Cooperation (consulting services) and the KfW on Financial Cooperation (investment projects).

Since development cooperation with India cannot be divorced from economic and political developments in the country, many projects are carried out in close cooperation with business associations (chambers of commerce) and self-help organizations of small and medium-sized business.

On the political front, the German government is open to initiatives for developing regional cross-border cooperation with neighbouring countries, also incorporating the experience of other developing nations, in a South-South cooperative effort.

Development policy dialogue at government level takes place at the annual intergovernmental consultations and negotiations on development policy.

Cultural exchange

Indo-German cultural exchange was formalized in a cultural agreement which came into force in September 1969. Since then, the Indo-German cultural consultations, held every three years, have formed a working basis for projects and exchanges in culture and education.The most recent cultural consultations were held in October 2005; it is India’s turn to organize the next consultations.

There are six branches of the Goethe Institute in India. They are called Max Mueller Bhavans after the founder of Indian studies, Max Mueller. The institutes do language and programme work and provide information in New Delhi (also the regional institute for South Asia), Kolkata, Chennai, Bangalore, Mumbai and Pune. Besides the organization of cultural programmes, the main focus is on language work. Some 12,000 people currently attend the German courses offered by the Max Mueller Bhavans each year.

The network of institutes is being enlarged by the addition of five Goethe Centres in Ahmedabad, Chandigarh, Coimbatore, Hyderabad and Trivandrum.

As part of the PASCH Initiative, the Goethe Institute and the Central Agency for Schools Abroad has succeeded in getting 54 Indian partner schools to introduce German as a foreign language. There are an estimated 13,000 pupils learning German at these schools. In September 2011, the Goethe Institute signed a memorandum of understanding with the national chain of schools operated by Kendriya Vidyalaya Sangathan, under which the Goethe Institute is to help the chain of schools introduce German as a subject at all its approximately 1,000 schools over the next three years by training German teachers.

An Indian cultural centre (Tagore Centre) is located at the Indian Embassy in Berlin.

The branch office of the German Academic Exchange Service (DAAD) in New Delhi supports bilateral university and research cooperation programmes and is concerned with scholarship programmes and study counselling. The DAAD offers all its regular support programmes in India as well as a number of special India-specific programmes, some of them co-funded, including scientific and academic exchange and project-related individual exchange programmes. There are currently some 4,000 Indian students at German universities. The number of German students at Indian universities is estimated at around 200.

Since2009, the DAAD has been promoting study and research stays in India under the programme initiative “A New Passage to India”.

There are currently seven academic teachers working in India (two regular teachers, two Information Centre teachers and three lecturers) as well as five language assistants.

The University of Heidelberg’s South Asia Institute has had its own office in New Delhi since 1962. It plays an important role as an interface for Indian studies experts from German and Indian research institutions.

There is an approved German School in New Delhi offering instruction up to 12th grade (German International Abitur Examination).

On 31 May 2011, Federal Chancellor Merkel officially opened theGerman Year in New Delhi – officially entitled “Germany and India 2011-2012: Infinite Opportunities”. A series of events, held in seven Indian metropolises and other large cities from September 2011 to November 2012, will present a comprehensive picture of Germany as India’s partner for the future under the overall theme of urban development.

Scientific and technological cooperation

Scientific and technological cooperation with India dates back to the late 1950s and is based partly on two intergovernmental agreements (1971 and 1974). Indian science (particularly space research, IT and biotechnology) enjoys a good reputation in Germany, and vice versa. Since the 1990s, there have been regular meetings at state secretary level, at which important projects and cooperation priorities have been discussed. The most recent meeting was held in Delhi in March 2010.

India’s importance as a cooperation partner in the scientific sector is underlined not least by high-level visits. To coincide with the first Indo-German intergovernmental consultations, which were held on 31 May 2011 and co-chaired by Federal Chancellor Merkel and Prime Minister Singh, a total of ten bilateral agreements were signed. Nine of these ten agreements dealt with education and research, focusing on bilateral research cooperation in biotechnology, the environment, materials sciences and vocational training. Federal President Horst Köhler’s official visit to India in February 2010, which included the inauguration of the Indo-German Max Planck Centre for Computer Science (IMPECS) at the Indian Institute of Technology (IIT) in New Delhi, was also of importance in terms of scientific cooperation.

German science attained a higher profile in Indiathrough the Indo-German ‘Science Express’ that travelled around the country from 2007 to 2011. Officially launched by Federal Chancellor Merkel in October 2007, this interactive travelling exhibition on rails reached 6 million visitors in India.

Germany is India’s second most importantresearch partner worldwide, after the USA, as is evidenced by the large number of joint Indo-German scientific publications.

Germany’s only bilateral research promotion centre worldwide is based in India: the Indo-German Science and Technology Centre (IGSTC) in Gurgaon near New Delhi is being co-funded by Germany and India from 2008 to 2017, each country contributing an annual EUR 2 million. Officially launched during Federal Research Minister Schavan’s visit to India in September 2008, it promotes bilateral, application-oriented research projects involving industrial partners from both countries.

India has a major stake in several large research institutions in Germany. India has contributed some EUR 30 million to the multinational FAIR particle accelerator in Darmstadt and has also invested substantial sums in licences for use of the DESY particle accelerator in Hamburg.

The more than 1,000 Indian postgraduate studentsin Germany constitute the second largest group of foreign PhD students after the Chinese. To further step up academic exchange between Germany and India, Federal Research Minister Schavan launched the scholarship programme ‘A New Passage to India’ during her visit to India in 2008. Worth an annual EUR 4.3 million, the programme, which is being implemented by the German Academic Exchange Service (DAAD), is specifically designed to strengthen young German scientists’ India competence.

The Max Planck Society’s cooperation with India, based on an agreement with India’s Department of Science and Technology (DST), is gaining momentum. In 2009, there were more than 600 research stays by Indian scientists at Max Planck Institutes. With 120 participants, Indians make up the largest foreign group at the International Max Planck Research Schools. There are 14 Max Planck Partner Groups working in India – more than in any other country.

In terms of Alexander von Humboldt Foundation scholarships, India ranks third worldwide, after the USA and Japan, with a total of more than 1,500 scholarship holders.

The German Research Foundation (DFG) has had its own offices in New Delhi and Hyderabad since 2006. Since then, there has been a steady increase in DFG-funded bilateral research cooperation. For example, as part of the First Indo-GermanInternational Graduate School, PhD students from the Universities of Münster and Hyderabad have been working since 2009 in the area of glycochemistry under the joint supervision of professors from both universities.

This example has spawned similar activities in India and Germany, with further initiatives for such graduate schools already in existence or in the offing.

The Year of Germany in India, officially entitled ‘Germany and India 2011-2012: Infinite Opportunities’ andrunning from September 2011 to November 2012, is being accompanied by a host of demonstration projects, exhibitions, symposia and workshops on science and research. Under the overall motto ‘Stadträume – City Spaces’, Germany’s scientific community will be making significant contributions with its competence in urban technologies.

India’s importance as a partner country in science and technology cooperation is also underlined by the Federal Foreign Office’s decision to set up a German Science and Innovation House (DWIH) in Delhi, one of five locations worldwide. The DWIH will function as an umbrella organization of all German scientific institutions in India. It is due to be inaugurated in New Delhi in 2012 as part of the Year of Germany in India.

Environmental relations

The environment has traditionally been a focus of German development cooperation with India.

As early as September 1998, the two countries’ environment ministers signed a memorandum of understanding aimed at extending development projects in selected areas. Environmental protection and nature conservation currently form one of the three priority sectors of German development cooperation with India.

Projects in India are also to be supported as part of the Federal Government’s International Climate Initiative launched in 2008. The projects will focus mainly on renewable energy. The required funding is to come from the auctioning of emission certificates in Germany.

To meet the urgent environmental challenges we face, Germany is also seeking to step up political dialogue with India. In November 2008, Federal Environment Minister Gabriel and his Indian counterpart opened the first Indo-German Environment Forum in New Delhi, which focused on the following areas: water supply and sanitation, waste management, energy efficiency, renewable energy and the Clean Development Mechanism (CDM) proposed in the Kyoto Protocol.A follow-up event is planned for the end of 2011. Another event held annually since 2009 is the bilateral Carbon Bazaar which addresses practical issues relating to emissions trading.

In March 2009, India was the first major threshold country to join the International Renewable Energy Agency (IRENA). Prior to this, India had also taken part in the international Renewables 2004 conference initiated by the Federal Government and held in Bonn in June 2004. In addition, it is active in the Renewable Energy Policy Network for the 21st Century (REN 21) set up at that event and hosted the 3rd follow-up conference (since Bonn 2004), which was held in New Delhi from 26 to 29 October 2010 under the official name Delhi International Renewable Energy Conference (DIREC 2010).

external link, opens in new windowhttp://www.direc2010.gov.in/pdf/DIREC-2010-Report.pdf

Development cooperation

India is a partner country of German development cooperation. For more information please visit the website of the external link, opens in new windowFederal Ministry for Economic Cooperation and Development