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Berlin: Prime Minister Narendra Modi on Tuesday called on “more and more German companies” to invest in India even as the speedy conclusion of an India-European Union (EU) free trade agreement (FTA) was the focus on the German side.
Highlighting the huge potential that remains untapped in the economic partnership during his inaugural address at the Indo-German Business Summit here, Modi said India will welcome German companies with open arms.
“There are 600 Indo-German joint ventures operating in India, employing 2,00,000 people. But there is huge potential as Indo-German economic cooperation is below its full potential and to enhance this, we in India are waiting with open arms because we value German partnership a lot,” Modi said.
The deadlock over the FTA between India and the EU was also highlighted at the summit, with German Chancellor Angela Merkel and senior business leaders urging the prime minister for a speedy conclusion to the agreement.
“There are growing protectionist trends around the world but Germany believes the value chains are so deeply interconnected that we will continue to create fair trading conditions. Within this context, it is important that the FTA makes progress,” Merkel said.
“Germany will continue to push Brussels to resolve negotiations more speedily and we are committed to implement and put into practice such an agreement. The negotiations have been tough because every country must safeguard its own interests and Germany will ensure that India’s concerns are also put on the table,” she said.
Dr Hubert Lienhard, president and chief executive officer of German industry body the Asia-Pacific Committee of German Business (APA), also urged Modi on resolving the agreement to enable investments. “Tension is not good for investment. It is important we join forces in pushing to reopen negotiations, to ensure stable trade relations for the future,” he said.
The representations came as the ministry of external affairs (MEA) confirmed that India and the EU negotiators are to take forward discussions on the agreement at a meeting in July. The details of this meeting have not been finalised, but the MEA said the aim was to work towards a speedy resolution of an agreement in light of the Indo-German bilateral trade treaty having expired in March this year.
“We are committed and have been engaging on this issue and hope an agreement can be reached as fast as possible,” MEA spokesperson told reporters at a briefing following the Fourth Inter-Governmental Consultations (IGC) between Modi and Merkel earlier in the day. Stressing that India refers to the deal as a Broad-based Trade and Investment Agreement (BTIA), he said both countries were committed to creating a healthy ecosystem for investments from Germany.
“They [Modi and Merkel] also reaffirmed their strong commitment to the EU-India Broad-based Trade and Investment Agreement and their commitment to bring about a resumption of the negotiations at the earliest possible date.
“This would, inter alia, allow to establish provisions for the mutual protection of new foreign investments,” said the joint statement issued by Modi and Merkel after the IGC.
At the business summit, the prime minister’s focus was on highlighting India’s liberalised FDI regime and growing ease of doing business. Describing GST as the “most historic reform India ever done”, he said the trend of reforms is spreading fast to all states. He highlighted the abolition of the Foreign Investment Promotion Board (FIPB) to “expand the engagement of overseas investors in Indian economy”.
After his address, Modi left for courtesy call on German President Dr Frank-Walter Steinmeier at Castle Bellevue, his official residence. Modi will leave for Spain after his meeting with the president later on Tuesday.